Homework No. 1

Question 2: Figy Co entered into a 4-year lease agreement on 1 January 20X5. The agreement meets the definition of a lease in accordance with IFRS 16. An initial payment of $150,000 was made on 1 January 20X5 followed by three annual payments on 1 January of $110,000 each. The rate implicit in the lease is 10%. Figy Co incurred initial direct costs of X2 to set up the lease. Required: 1. Give your own X2 then calculate the cost of the right-of-use asset as at 1 January 20X5? 2. What is the carrying amount of the lease liability at 31 December 20X6? 3. What amount will be charged to the statement of profit or loss in respect of this asset for the year ended at 31 December 20X6? 4. Prepare necessary accounting entries related to this lease agreement for the year ended at 31 December 20X5.

Problem 2 On January 1, 20X1, ABC Co. enters into a 4 year lease of office equipment. Annual rental payable at the end of each year is P 12,000. As inducement in entering into the lease, the lessor makes the first 3 months of the lease as rent-free. ABC Co. opts to use the practical expedient allowed under PFRS 16 for leases of low value assets. Provide journal entries.

7

Item 3 On June 30, 2021, Georgia-Atlantic, Inc. leased warehouse equipment from Builders, Inc. The lease agreement calls for Georgia-Atlantic to make semiannual lease payments of $677,829 over a 4-year lease term (also the asset’s useful life), payable each June 30 and December 31, with the first payment at June 30, 2021. Georgia-Atlantic's incremental borrowing rate is 10.0%, the same rate Builders used to calculate lease payment amounts. Builders manufactured the equipment at a cost of $4.1 million. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required:1. Determine the price at which Builders is “selling” the equipment (present value of the lease payments) at June 30, 2021.2. What amount related to the lease would Builders report in its balance sheet at December 31, 2021 (ignore taxes)?3. What line item amounts related to the lease would Builders report in its income statement for the year ended…

1

Sir please help me sir urgently with explain answer

Problem 3: ABC Co. leased a new machine from XXX Inc. on January 1, 20X1, under a lease with the following information:   Lease term 10 years Annual rent payable at the end of each year P 80,000 Useful life of the machine 12 years Implicit interest rate 14% Lessee’s incremental borrowing rate 12%   The annual rental payment includes P 6,000 to cover maintenance costs. The maintenance costs transfer services to ABC. The amount charged reflects the stand alone selling price of the maintenance services.   Requirements: Provide the entries in 20X1 and 20X2. Determine the current and non-current portions of the lease liability on December 31, 20X1.

i.3

3

2

acc

1 5 points On June 30, 2024, Georgia-Atlantic, Incorporated leased warehouse equipment from Builders, Incorporated The lease agreement calls for Georgia-Atlantic to make semiannual lease payments of $880,440 over a 3-year lease term (also the asset's useful life), payable each June 30 and December 31, with the first payment on June 30, 2024. Georgia-Atlantic's incremental borrowing rate is 8.0%, the same rate Builders used to calculate lease payment amounts. Builders manufactured the equipment at a cost of $4.3 million. Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) Required: 1. Determine the price at which Builders is "selling" the equipment (present value of the lease payments) on June 30, 2024. 2. What amount related to the lease would Builders report in its balance sheet on December 31, 2024 (ignore taxes)? 3. What line item amounts related to the lease would Builders report in its income statement for the…

Sh6

Denger

Hi expart give correct answer

go.2

Problem 1 Whistler Inc. signed a 6 year non-cancelable lease at the beginning of the year. The leased equipment has a 9 year economic life. The fair value of the leased equipment is $29,000. Annual lease payments due at the beginning of each year are $5,200. There is no bargain purchase option, and the leased asset reverts to the lessor at the end of the lease term. The implicit rate of interest on the lease (known by the lessee) is 6%. Collection of all lease payments is reasonably assured. Part A. What is the classification of this lease from the perspective of the lessee? Part B. What is the classification of this lease from the perspective of the lessor?

Munabhai

Rey