-On December 31, 20X4, Red co. leased a machine from Greenco. for a seven-year period. Equal annual payments under the lease are $112,500, including $7,500 annual executory costs, and are due on December 31 of each year. The first payment was made on December 31, 20X4, and the second payment was made on December 31, 20X5. The seven lease payments are discounted at 9% over the lease term. The present value of lease payments at the inception of the lease and before the first annual payment was $576,500. The lease is appropriately accounted for as a finance lease by Red Co. In its December 31, 20X5 balance sheet, Red Co. should report a lease liability of:A. $408,935?B.$576,500?C.$405,325?D.$525,0002.On December 31, 20X9, Adam Co. leased a machine under a finance lease for a period of ten years, contracting to pay $50,000 on signing the lease and $50,000 annually on December 31 of the next nine years. The present value at December 31, 20X9, of the ten lease payments over the lease term discounted at 10% was $338,000. At December 31, 20X10, Adam’s total finance lease liability is?A.$303,980?B.$266,800?C.$259,200?D.$243,0003.A company signed an operating lease agreement to use office space for 5 years.?he company took possession and began to use the building on January 1, Year 1.?nnual rent of $24,000 is due on the first day of each year.?ssuming an implicit interest rate in the lease of 6%, the present value of the lease payments at the inception of the lease is $107,163.?n December 31, Year 3, what amount should the company report as the lease liability balance on its balance sheet??A.$35,163?B.$44,002?C.$48,000?D.$64,153AccountingBusinessFinancial AccountingACCT 311
