On January 1, 2018, Gibson Corporation entered into a four-year operating lease. The payments were as follows: $20,000 for 2018, $18,000 for 2019, $16,000 for 2020, and $14,000 for 2021. What is the correct amount of total lease expense for 2019?
A) $20,500.
B) $19,000.
C) $17,000.
D) $18,000.

Question

Quizplus · Accepted Answer

11ea937b_35db_0d51_a419_61f2e553f94c_TB2599_00 In an operating lease for the lessee, the amortization expense is plugged to cause the total lease expense (interest plus amortization) to be a straight-line amount. If there are uneven payments (advance payment, scheduled rent increases, or scheduled rent decreases), the rent leveling effect will be reflected in the right-of-use asset.

On January 1, 2018, Gibson Corporation Entered into a Four-Year