Answered: How much is the rent receivable/…

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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Question

A lessor leased out an office space for 5 years on January 1, 2020. The lease was properly accounted for as an operating lease. The rental payment are as follows:

first to second year - P300,000 per month

third to fifth year - P36,000 per month

The lease contract provides for a 6-month advance and 1 month security deposit. The lessee also paid a P60,000 lease bonus to obtain the lease. The security deposit will be returned at the end of the lease. The advances may be applied against the last three months of the lease.

QUESTION: How much is the rent receivable/ unearned rent as of December 31, 2021?

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