Exercise Algo Salestype lease; lessor; balance sheet and income statement effects L
On June GeorgiaAtlantic, Incorporated leased warehouse equipment from IC Leasing Corporation. The lease agreement
calls for GeorgiaAtlantic to make semiannual lease payments of $ over a fouryear lease term also the asset's useful life
payable each June and December with the first payment on June GeorgiaAtlantic's incremental borrowing rate is
the same rate IC used to calculate lease payment amounts. IC purchased the equipment from Builders, Incorporated at a cost of $
million.
Note: Use tables, Excel, or a financial calculator. FV of $ PV of $ FVA of $ PVA of $ FVAD of $ and PVAD of $
Required:
What amount related to the lease would IC report in its balance sheet on December ignore taxes
What amount related to the lease would IC report in its income statement for the year ended December ignore taxes
Note: For all requirements, enter your answers in whole dollars and not in millions. Round the intermediate calculation and final
answers to the nearest whole dollar.
