Multiple Choice Question 99
On June 30, 2018, Falk Co. sold equipment to an unaffiliated company for $2,000,000. The equipment had a book value of $1,080,000 and a remaining useful life of 10 years. That same day, Falk leased back the equipment at $12,000 per month for 5 years with no option to
renew the lease or repurchase the equipment. Falk's rent expense for this equipment for the year ended December 31, 2018, should be
$96,000.
$120,000.
$288,000.
$72,000.