Business, 23.05.2020 23:59 kenziebug34

On January 1, 2021, Blossom Corporation signed a five-year noncancelable lease for equipment. The terms of the lease called for Blossom to make annual payments of $170000 at the beginning of each year for 5 years with title passing to Blossom at the end of this period. The equipment has an estimated useful life of 7 years and no salvage value. Blossom uses the straight-line method of depreciation for all of its fixed assets. Blossom accordingly accounts for this lease transaction as a finance lease. The lease payments were determined to have a present value of $708878 at an effective interest rate of 10%.In 2021, Blossom should record interest expense of $.

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On January 1, 2021, Blossom Corporation signed a five-year noncancelable lease for equipment. The te...

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