88 On 1 January 20X4, Jedi Plc entered into a finance lease for a machine with a fair value of GHS 2,050. Lease payments of GHS 500 are payable annually in advance for five years, starting on 1 January 20X4. Jedi Plc allocates finance charges on a sum-of-digits basis. According to IAS 17 Leases, what is Jedi Ple's non-current liability in respect of this finance lease as at 31 December 20X4? A B с D GHS 1,200 GHS 1,230 GHS 1,365 GHS 1,500

88 On 1 January 20X4, Jedi Plc entered into a finance lease for a machine with a fair value of GHS 2,050. Lease payments of GHS 500 are payable annually in advance for five years, starting on 1 January 20X4. Jedi Plc allocates finance charges on a sum-of-digits basis. According to IAS 17 Leases, what is Jedi Ple's non-current liability in respect of this finance lease as at 31 December 20X4? A B с D GHS 1,200 GHS 1,230 GHS 1,365 GHS 1,500

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Aa.31.
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19. KAPIT LANG CEREBELLUM leased a new machine to MALAPIT NA ANG FINISH LINE on January 01, 2012. The lease expires on January 01, 2017. Annual rental is P900,000. Additionally, on January 01, 2012, MALAPIT NA ANG FINISH LINE paid P500,000 to KAPIT LANG CEREBELLUM as a lease bonus and P250,000 as a security deposit to be refunded upon expiration of the lease. In KAPIT LANG CEREBELLUM's 2012 statement of comprehensive income, the amount of rental revenue should be a. P1,400,000 b. P1,250,000 c. P1,000,000 d. P900,000
Smart Ltd negotiated a lease on the following terms: the lease had a 3 year term; the purchase price of the new equipment was R41 250; there were 3 annual payments of R15 000 payable in advance; and Smart Ltd was able to borrow at 10% per annum. The balance sheet liability figure at the end of the second year would be Select one: O a. R13 750 O b. R15 000 O c. R12 250 O d. R15 000
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Question 11. C Ltd has a fiscal year end of Sep. 30th. On Oct. 1, 20X8 C Ltd leases an asset to a lessee for a term of five years. The lessee is required to make five lease payments of £27,500, starting with Oct 1, 20X8. The fair value of the asset on Oct 1, 20X8 is £113,500. C Ltd incurs initial direct costs of £421 and the rate of interest implicit in the lease is 12%. At the end of the lease term, ownership of the asset will remain with C Ltd, the asset is expected to have come to the end of its economic life and to have a residual scrap value of £5,100. i) Provide two reasons for why this lease is a finance lease and not an operating lease. ii) Calculate the net investment in the lease at commencement. iii) Prepare lessor's journal entries for the year ending Sep. 30th, 20X9.
(AICPA) 6. On January 1, 20x8, Harrow Co. as lessee signed a five-year noncancellable equipment lease with annual payments of P100,000 beginning December 31, 20x8. The implicit interest rate is 10%. How much is the interest expense for the year ended December 31, 20x8? a. 37,900 (AICPA) b. 27,900 с. 24,200 d. 0
Accounting On 30 June 2022, Sock Ltd leased equipment to Shoe Ltd. The equipment was in the records of Sock Ltd on 30 June 2022 at its fair value of $123,000. The lease agreement contained the following provisions: Lease term 3 years Economic life of equipment 4 years Annual rental payment, in arrears (first payment on 29/6/23) $45,000 Residual value at end of the lease term $10,000 Residual value guaranteed by lessee $4,000 Interest rate implicit in lease 8% Present value of $1 in 3 years at 8 % 0.7938 Present value of an annuity of $1 for 2 payments at 8% 1.7833 Present value of an annuity of $1 for 3 payments at 8% 2.5771 The equipment will be depreciated by Shoe Ltd on a straight-line basis. Shoe Ltd intends to return the equipment to Sock Ltd at the end of the lease term. The lease has been classified as a finance lease by Sock Ltd. Initial direct costs for setting up the lease were incurred by both parties: $855 for Shoe…
On 1 March 2020,the company entered into a lease agreement in order to lease a manufacturing machine with a costprice of R250 000 (VAT inclusive). The period of the lease is five years, and the useful life of the machinery is estimatedat six years. The following is an extract from the lease agreement:4.1.1 Ownership of the machinery will be transferred to the Lessee at the end of the lease.4.1.2 Should the Lessee cancel the lease, the Lessor’s losses will be borne by the Lessee.Monthly instalments are payable in arrears and amount to R5 947 (VAT inclusive). The company used themanufacturing machine for a qualifying purpose. The company is a registered VAT vendor.Required:Provide the deferred tax movement per the balance sheet method for the lease agreement for the financial year ending31 December 2021. Clearly indicate whether the movement represents an income or an expense. Note:- Show all calculations, marks are awarded for calculations.- You may round off to the nearest Rand.
am. 90.
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