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CITY OF PARIS, TEXAS <br />Notes to Financial Statements (Continued) <br />September 30, 2020 <br />IV. Detailed Notes on All Activities and Funds (Continued) <br />J. Capital Leases (Continued) <br />The future minimum lease payments required under the capital leases and the present value of the net minimum <br />lease payments as of September 30, 2020, are as follows: <br />Year Ending September 30, <br />Amount <br />2021 <br />$ 72,353 <br />2022 <br />72,353 <br />2023 <br />72,353 <br />2024 <br />72,353 <br />2025 <br />72,353 <br />Total Minimum Lease Payments <br />361,765 <br />Less: Amount Representing Interest <br />(30,479) <br />Present Value of Net Minimum Lease Payments <br />331,286 <br />Less: Current Maturities of Capital Lease Obligation <br />(62,412) <br />Long -Term Portion of Capital Lease Obligation <br />$ 268,874 <br />In January 2016, the City began leasing equipment under an agreement classified as a capital lease due to a <br />bargain purchase option. The capital lease and accumulated amortization are as follows: <br />Capital Lease Equipment, at Cost $ 975,185 <br />Less: Accumulated Amortization 355,945 <br />Capital Lease Equipment, Net $ 619,240 <br />The future minimum lease payments required under the capital leases and the present value of the net minimum <br />lease payments as of September 30, 2020, are as follows: <br />Year Ending September 30, <br />Amount <br />2021 <br />$ 114,337 <br />2022 <br />114,337 <br />2023 <br />114,337 <br />2024 <br />114,337 <br />2025 <br />114,337 <br />2026 <br />114,337 <br />Total Minimum Lease Payments <br />686,022 <br />Less: Amount Representing Interest <br />(66,782) <br />Present Value of Net Minimum Lease Payments <br />619,240 <br />Less: Current Maturities of Capital Lease Obligation <br />(95,661) <br />Long -Term Portion of Capital Lease Obligation <br />$ 523,579 <br />K. Long -Term Liabilities <br />In the government -wide financial statements and proprietary funds in the fund financial statements, long-term <br />debt and other long-term obligations are reported as liabilities in the applicable governmental activities, <br />business -type activities, or proprietary funds statement of net position. Bond premiums and discounts are <br />deferred and amortized over the life of the bonds using the effective interest method. Bonds payable are <br />reported net of the applicable bond premium or discount. Bond issuance costs are reported as expenses in the <br />year of issuance. <br />59 <br />