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JK company has the following balances on the 2008 B/S: current assets=70,000, long-term assets=250,000, current liability=40,000, long-term debt=130,000, and stockholders equity=150,000. The company has an operating lease contract. It promises to pay a lessor $10,000 annually for the next three years. The company s average borrowing rate (discount rate) is 10%. If the lease is recorded as a capital lease, what will be the long-term asset total?

a. about 250,500

b. about 274,868

c. about 285,131

d. about 296,321

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Accounting Basics, Accounting

Category:- Accounting Basics
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