Sunland desires a 8% rate of return on its investments. Coronado’s incremental borrowing rate is 12%. Sunland’s implicit rate is unknown to Coronado. Instructions (Assume the accounting period ends on December 31.)
B: Calculate the amount of the annual rental payment required.
C: Prepare the journal entries Sunland would make in 2017 and 2018.
D: Compute the present value of the minimum lease payments for Coronado.