alleryStart learning →Unearned finance income is gross investment less the present value of
AContingent rent at market rate
BRentals at lessee's borrowing rate
CRentals plus residual, implicit rate
DFair value less carrying amount
Answer & Solution
Correct answer: C. Rentals plus residual, implicit rate
It is the gap between gross investment and the present value of minimum lease payments and unguaranteed residual discounted at the implicit rate.
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