Grover Manufacturing is leasing some equipment from Woodson Equipment. Woodson has classified the lease as a sales-type lease. For what reason would Grover Manufacturing increase the present value of the lease payments

Grover Manufacturing increases the present value of the lease payments This is so that the lessee will be informed of any changes to the next lease payments.

How lease affect the debt?

Your DTI ratio rises as a result of the debt obligation that leasing a car adds to your credit report. You can, however, make your lease payments more affordable by negotiating in certain ways, which will lessen the impact. The gross capitalization cost is one lease component you might discuss to reduce the monthly payment.

Grover Manufacturing increases the present value of the lease payments This is so that the lessee will be informed of any changes to the next lease payments. Due to the increased future lease payments as a result of this modification, the lessee now has a greater lease debt.

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