On December 31, 2015, Lang Corporation Leased a Ship from Fort

question 24

Multiple Choice

On December 31, 2015, Lang Corporation leased a ship from Fort Company for an eight-year period expiring December 30, 2023.Equal annual payments of $200,000 are due on December 31 of each year, beginning with December 31, 2015.The lease is properly classified as a finance lease on Lang 's books.The present value at December 31, 2015 of the eight lease payments over the lease term discounted at 10% is $1,173,685.Assuming all payments are made on time, the amount that should be reported by Lang Corporation as the total lease liability on its December 31, 2016 statement of financial position.

• A)$1,091,054.
• B)$1,000,159.
• C)$871,054.
• D)$1,200,000.

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