On January 1, Ramirez Supply leased a car for a four-year period, at which time possession of the car will revert back to the lessor. Annual lease payments are $20,000 due on December 31 of each year, calculated by the lessor using a 5% discount rate. Negotiations led to Ramirez guaranteeing the lessor a $74,000 residual value at the end of the lease term although Ramirez estimates that the residual value after four years will be $70,000. Required:
What is the amount to be added to the right-of-use asset and lease payable under the residual value guarantee?

As a result of a labeling mistake at the chemical factory, a farmer accidentally sprays weedkiller rather than fertilizer on half her land. as a result, she loses half of her productive farmland. if the property of diminishing returns applies to all factors of production, she should expect to seea. a decrease in the marginal productivity of her remaining land and an increase in the marginal productivity of her labor. b. an increase in the marginal productivity of her remaining land and an increase in the marginal productivity of her labor. c. an increase in the marginal productivity of her remaining land and a decrease in the marginal productivity of her labor. d. a decrease in the marginal productivity of her remaining land and a decrease in the marginal productivity of her labor.