On January 1, 2018, Princess Corporation leased equipment to King Company. The lease term is eight years. The first payment of $675,000 was made on January 1, 2018. The equipment cost Princess Corporation $3,600,000. The present value of the lease payments is $3,960,000. The lease is appropriately classified as a sales-type lease. Assuming the interest rate for this lease is 10%, how much interest revenue will Princess record in 2019 on this lease?
A) $261,000.
B) $328,500.
C) $325,350.
D) $293,850.
Correct Answer:
Verified
Q57: On October 1, 2018, Sonoma Company leased
Q58: Refer to the following lease amortization schedule.
Q59: Refer to the following lease amortization schedule.
Q60: Refer to the following lease amortization schedule.
Q61: When a finance lease is first recorded
Q63: XYZ Company leased equipment to West Corporation
Q64: N Corp. entered into a nine-year finance
Q65: If the lessee expects to obtain title
Q66: By the lessee, a lessee-guaranteed residual value
Q67: Recording a sales-type lease with a selling
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents