On 1 July 2020, the company had entered into a five-year lease agreement for an asset with RF S.A.O.G. The company must make lease payments of OMR 100,000 annually at the beginning of each year. The present value of the total lease payments is RO 379,000. The estimated useful life of the asset is 5 years. The cost of capital used is 10 %. Calculate the amount that will be charged in the income statement with regards to such asset for the year ended 31st December 2020. Oa OMR 100,000. Ob.OMR 51,850. O C OMR 75,800. Od. OMR 50,000.

On 1 July 2020, the company had entered into a five-year lease agreement for an asset with RF S.A.O.G. The company must make lease payments of OMR 100,000 annually at the beginning of each year. The present value of the total lease payments is RO 379,000. The estimated useful life of the asset is 5 years. The cost of capital used is 10 %. Calculate the amount that will be charged in the income statement with regards to such asset for the year ended 31st December 2020. Oa OMR 100,000. Ob.OMR 51,850. O C OMR 75,800. Od. OMR 50,000.

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter19: Lease And Intermediate-term Financing

Section: Chapter Questions

Problem 1P

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On 1 July 2020, the company had entered into a five-year lease agreement for an asset with RF S.A.O.G. The company must make lease payments of OMR 100,000 annually at the beginning of each year. The present value of the total lease payments is RO 379,000. The estimated useful life of the asset is 5 years. The cost of capital used is 10%. Calculate the amount that will be charged in the income statement with regards to such asset for the year ended 31st December 2020. O a. OMR 100,000. O b. OMR 51,850. OC. OMR 75,800. O d. OMR 50,000.
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