What total amount of interest revenue should be recognized

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Problem 1: Grand Company leases a computer equipment under a direct financing lease. The equipment has no residual value at the end of the lease, and the lease does not contain purchase option. The entity wishes to earn 8% interest on a 5-year lease of equipment with a cost of P3,234,000. The present value of an annuity of 1 at *% for 5 periods is 4.312. What total amount of interest revenue should be recognized over the lease term?

Reference no: EM132807679

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