Boréal leases a warehouse for 4 years. Fixed annual lease payments of 50,000 are made at the end of each year; no payment is made at the commencement date. Since the implicit rate cannot be readily determined, Boréal uses its incremental borrowing rate of 6 %. Compute the lease liability at the commencement date, rounded to the nearest euro.
- Annual lease payment made at the end of the year
- 50,000
- Lease term
- 4
- Incremental borrowing rate
- 6 %