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What is effect of this lease on zeffers net income for year

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Zeffer Inc. leased a machine worth $500,000 to a client at beginning of year 11. The machine has a 20-year life. Zeffer will receive 10,000 at the beginning of each year for 5 years. At the end of 5 years, the machine is transferred back to Zeffer. As part of negotiating the lease term, Zeffer incurred $1,000 of legal fees in 1/1/Year 11.

What is effect of this lease on Zeffer's net income for Year 11? Ignore any taxes. Please clearly indicate increase or decrease next to your final answer.

Reference no: EM131792898

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