Question:On January 1 of Year 1, XYZ Company leases equipment under a capital lease that calls for five payments of $25,000 at the end of each year. The first payment is due on December 31 of Year 1. Using 12 percent interest, the present value of the lease liability is $90,000 on January 1 of Year 1. How much of the first payment of $25,000 is interest expense? 

A $10,800 
B $7,000 
C $15,000 
D $10,000 

+ Answer
C 

+ Explanation
Answer not sure

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Md. Habib Ullah

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