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Reed machinery just signed a capital lease agreement with a


Reed Machinery just signed a capital lease agreement with a present value of $130,000. How would this lease first appear on Reed Machinery's balance sheet? rev: 10_17_2017_QC_CS-105757

  • Capital leases do not appear on the balance sheet.
  • Assets under capital lease $260,000; Obligations under capital lease $260,000
  • Assets under capital lease $130,000; Obligations under capital lease $130,000
  • Assets under capital lease $260,000; Retained earnings committed to leases $260,000
  • Assets under capital lease $130,000; Retained earnings committed to leases $130,000

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Finance Basics: Reed machinery just signed a capital lease agreement with a
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