1. Gemini leased an item of plant on 1 April 20X1 for a five-year period. Annual rentals in advance were £60,000. The cash price (fair value) of the asset on 1 April 20X1 was £260,000. The company's depreciation policy for this type of plant is 25 per cent per annum on the reducing balance basis.\\nRequired:\\nAssuming the interest rate implicit in the lease is 8 per cent, prepare extracts of the financial statements of Gemini for the year to 31 March 20X3.
1. Gemini leased an item of plant on 1 April 20X1 for a five-year period. Annual rentals in advance were £60,000. The cash price (fair value) of the asset on 1 April 20X1 was £260,000. The company's depreciation policy for this type of plant is 25 per cent per annum on the reducing balance basis.\\nRequired:\\nAssuming the interest rate implicit in the lease is 8 per cent, prepare extracts of the financial statements of Gemini for the year to 31 March 20X3.
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:1. Gemini leased an item of plant on 1 April 20X1 for a five-year period. Annual rentals in advance were £60,000. The cash price (fair value) of the asset on 1 April 20X1 was
£260,000. The company's depreciation policy for this type of plant is 25 per cent per annum on the reducing balance basis.\\n Required:\\nAssuming the interest rate implicit
in the lease is 8 per cent, prepare extracts of the financial statements of Gemini for the year to 31 March 20X3.
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