Metcalf should record the leased asset


Metcalf company leases a machine from Vollmert corp. under an agreement which meets the criteria to be a capital lease for Metcalf. The six-year lease requires payment of $102,000at the beggining of the year, including $15,000 per year for maintenance. insurance and taxes. The incremental borrowing rate for the lessee is 10%; the lessor's implicit rate is 8% and is known by the lease. The present value of an annuity due of 1 for six years at 10% is 4.79079. The present value of an annuity due of 1 for six years at 8% is 4.99271. Metcalf should record the leased asset at?

Request for Solution File

Ask an Expert for Answer!!
Accounting Basics: Metcalf should record the leased asset
Reference No:- TGS083182

Expected delivery within 24 Hours