Help pleaseee.. Chicken Nuggets Company leased a machine on January 1. 2021 with the following...
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Accounting
Help pleaseee.. Chicken Nuggets Company leased a machine on January 1. 2021 with the following information:
Annual rent payment, every December 31, 2021 700,000
Lease Term 10 years
Useful life of machine 12 years
Incremental borrowing rate 14%
Implicit Interest rate 12%
PV of an ordinary annuity of 1 for 10 periods at 14% : 5.216 and 12% : 5.650
PV of 1 for 10 periods at 14% : 0.270 and 12% : 0.322
Chicken Nuggets Company has the option to purchase (reasonably certain) the machine upon the lease expiration on January 31, 2031 by paying P100,000. Determine the total lease liability.
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