The Agrinord cooperative leases a combine harvester for 6 annual seasons. Each lease payment of 30,000 is due at the start of the season, and the first is paid on the day the machine is delivered, which is the commencement date. The interest rate implicit in the lease, known to Agrinord, is 8 %. Determine the initial amount of the lease liability, rounded to the nearest euro.
- Annual lease payment due at the start of the season
- 30,000
- Number of seasons (years)
- 6
- Interest rate implicit in the lease
- 8 %