Please help Question 1 On June 30 2018 Blossom Co sold equip

Please help!

Question 1 On June 30, 2018, Blossom Co. sold equipment to an unaffiliated company for $1900000. The equipment had a book value of $1030000 and a remaining useful life of 10 years. That same day, Blossom leased back the equipment at $11800 per month for 5 years with no option to renew the lease or repurchase the equipment. Blossom\'s rent expense for this equipment for the year ended December 31, 2018, should be O $70800 $118000. $94400 $283200.

Solution

The correct answer for this question is A

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Per month rent Exp = $11800

Rent for 6 month = 11800 * 6 = $70800

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Hope that helps.

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