Question

Lasch Co. recorded a right-of-use asset of... I. Lasch Co. recorded a right-of-use asset of $200,000 in a 10-year operating lease. Payments of $32,550 are made annually at the end of each year. The interest rate charged by the lessor was 10%. The balance in the right-of-use asset after the first year will be:A) $180,000.B) $187,450C) $188,450.D) $200,000.

Answer 1

Answer:

187, 450.00

Explanation:

Cost of the asset : $ 200,000.00

Interest rate at 10 %

Payment per year = 32,550.00

First year total amount due = 10% plus asset cost

= ($200,000x 10/100)= 200,000

=$20,000+200 000

=$220,000.00

After deduction = $220,000- 32, 550

   =$ 187, 450.00