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What would welch record as annual amortization

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Reference no: EM132829182

Problem 1: Mantle Corporation leased machinery to Welch Company under a lease agreement that qualifies as a finance lease to Welch but not as a result of a bargain purchase option or a title transfer. The present value of the lease payments is $600,000. The expected useful life of the asset is seven years. The lease term is five years. Using the straight-line method, what would Welch record as annual amortization?

A) $61,000
B) $60,000
C) $120,00
D) $0

Reference no: EM132829182

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