On January 3, 2014, the Walters Corporation signed a 10-year non-cancelable lease for manufacturing equipment. The fair value of the equipment at that time was $550,000. At the end of the lease period, the equipment, which has an estimated life of 15 years, will be returned to the lessor. Additional information is below:
Walters should
A) capitalize the equipment at $550,000
B) capitalize the equipment at $491,565
C) capitalize the equipment at $452,018
D) not capitalize the equipment
Correct Answer:
Verified
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