Business, 04.07.2020 22:01 micro7909

For each independent scenario listed (ae), indicate whether AMC would classify the lease as an operating lease or finance lease. Assume the lease agreement has not met any of the other indicators of a finance lease. AMC Lease agreement: 1. The agreement calls for ownership of the warehouses to be transferred to AMC Foods at the end of the lease form 2. The fair value of the warehouses is expected to be $400,000 at the end of the lease term AMC has the option to purchase the warehouses at the end of the lease form for $80.000 3. The warehouses have a useful of 10 years and the form of the lease is 4 years 4. The present value of the lease payments is $4.400.000 and the fair value of the leased warehouses is $5,000,000 5.The warehouses were manufactured to meet specifications provided by AMC to optime is unique food delivery processes.

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