14 Mudau entered into a contract with Denga for a lease of 24 laptops, the contract was entered on 1 April 2021, for 2years, each item is of low value and Mudau limited applies the recognition exemption of IFRS 16 leases. The benefit delivered for Mudau limited from the lease agreement is constant over the lease period. The following amounts are payable to Denga limited per the lease agreement: From 1 April 2021 – 31 March 2022 R2 000 per month From 1 April 2022 – 31 March 2023 R3 000 per month Mudau limited has a 31 December year end. For the year ended 31 December 2021, lease payment will need to be recorded, therefore cash in the bank account will decrease by A. 18 000 B. 22 500 C. 24 000 D. None of the above.
14 Mudau entered into a contract with Denga for a lease of 24 laptops, the contract was entered on 1 April 2021, for 2years, each item is of low value and Mudau limited applies the recognition exemption of IFRS 16 leases. The benefit delivered for Mudau limited from the lease agreement is constant over the lease period. The following amounts are payable to Denga limited per the lease agreement: From 1 April 2021 – 31 March 2022 R2 000 per month From 1 April 2022 – 31 March 2023 R3 000 per month Mudau limited has a 31 December year end. For the year ended 31 December 2021, lease payment will need to be recorded, therefore cash in the bank account will decrease by A. 18 000 B. 22 500 C. 24 000 D. None of the above.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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14 Mudau entered into a contract with Denga for a lease of 24 laptops, the contract was entered on 1 April 2021, for 2years, each item is of low value and Mudau limited applies the recognition exemption of IFRS 16 leases. The benefit delivered for Mudau limited from the lease agreement is constant over the lease period.
The following amounts are payable to Denga limited per the lease agreement:
From 1 April 2021 – 31 March 2022 R2 000 per month
From 1 April 2022 – 31 March 2023 R3 000 per month
Mudau limited has a 31 December year end.
For the year ended 31 December 2021, lease payment will need to be recorded, therefore cash in the bank account will decrease by
A. 18 000
B. 22 500
C. 24 000
D. None of the above.
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