Advanced Accounting 10th Edition by Thomas Schaefer, Joe Ben Hoyle, Timothy Doupnik

Exercise 16

A city government has a nine-year capital lease for property being used within the General Fund.The lease was signed on January 1, 2010.Minimum lease payments total $90,000 starting at the end of the first year but have a current present value of $69,000.Annual payments are $10,000, and the interest rate being applied is 10 percent.What liability is reported on the fund-based financial statements as of December 31, 2010, after the first payment has been made
a.$-0-.
b.$59,000.
c.$65,900.
d.$80,000.