Mays Company has a machine with a cost of $500,000 which also is its fair value on the date the machine is leased to Park Company. The lease is for 6 years and the machine is estimated to have an unguaranteed residual value of $50,000. If the lessor's interest rate implicit in the lease is 12%, the six beginning-of-the-year lease payments would be
A) $115,451.
B) $103,082.
C) $97,725.
D) $83,333.

Question

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The Answer of Mays Company has a machine with a cost of $500,000 which also is its fair value on the date the machine is leased to Park Company. The lease is for 6 years and the machine is estimated to have an unguaranteed residual value of $50,000. If the lessor's interest rate implicit in the lease is 12%, the six beginning-of-the-year lease payments would be
A) $115,451.
B) $103,082.
C) $97,725.
D) $83,333.

Mays Company Has a Machine with a Cost of $500,000