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On January 1, 2015, Ogleby Corporation signed a five-year noncancelable lease for equipment.The terms of the lease called for Ogleby to make annual payments of $60,000 at the end of each year for five years with title to pass to Ogleby at the end of this period.The equipment has an estimated useful life of 7 years and no residual value.Ogleby uses the straight-line method of depreciation for all of its fixed assets.Ogleby accordingly accounts for this lease transaction as a finance lease.The minimum lease payments were determined to have a present value of $227,448 at an effective interest rate of 10%.
-With respect to this capitalized lease, for 2016 Ogleby should record
Experience
The knowledge or skill acquired by observing, participating in, or being exposed to events or activities over time.
Blood Vessels
The network of tubular structures (arteries, veins, and capillaries) through which blood circulates in the body.
Migraine Headaches
A type of headache characterized by intense, throbbing pain usually on one side of the head, often accompanied by nausea, vomiting, and sensitivity to light and sound.
Narrowing
The process of reducing or limiting the scope or breadth of something.
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