The Following Are Some of the Characteristics of an Asset

question 83

Essay

The following are some of the characteristics of an asset available for lease:
$$\begin{array} { | l | l | } \hline \text { Fair value of leased asset } & 150,000 \\\hline \text { Lease term } & 8 \text { years } \\\hline \text { Payment frequency } & \text { Annual } \\\hline \text { Payment timing } & \text { Beginning of year } \\\hline \text { Guaranteed residual value } & 25,000 \\\hline \text { Interest rate implicit in lease (not known to lessee) } & 11 \% \\\hline \text { Lessee's incremental borrowing rate } & 9 \% \\\hline\end{array}$$ Requirements:
a. Determine the amount of lease payment that the lessor would require to lease the asset.
b. Compute the present value of minimum lease payments for the lessee.

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Definitions:

Positive Messages

Communications that convey good news, approval, or optimistic information.

Negative Information

Data or facts that present an unfavorable or pessimistic perspective about something or someone.

Condolence Messages

Messages of sympathy and support sent to someone who is grieving the loss of a loved one.

Compositional Mode

A method or style of presenting information in written or artistic form.