Determine the price at which builders is selling

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Question - "On June 30, 2018, Georgia-atlantic, inc., leased a warehouse facility from ic leasing corporation. The lease agreement calls for Georgia-atlantic to make semiannual lease payments of $562907 over a three-year lease term, payable each June 30 and December 31, with the first payment at June 30, 2018. Georgia-atlantics incremental borrowing rate is 10%, the same rate ic uses to calculate lease payment amounts. Builders manufactured the equipment at a cost of 2.5million"

Required -

1. Determine the price at which builders is selling the equipment (present value of the lease payments) at 6/30/2018.

2. What amounts related to the lease would Builders report in balance sheet at 12/31/2018?

3. What amount related to the lease would builders report in its income statement for the year ended 12/31/18 (ignore taxes).

Reference no: EM132522239

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