On August 1, 2019, Pha Aviation leased two helicopters from Wayo Aircraft for an initial period of 12 months with a provision for a continuation of a month-to-month basis. The lease is property classified under a low value asset. Lease payments are to be made as follows: 1 st two months - P15,000 per month Next three months - P12,000 per month Next three months - P10,000 per month Last four months - P 7,500 per month After the first year, the rent continues at P6,000 per month. a. How much is Pha Aviation's rent expense for the year ended December 31, 2019? A. P10,500 B. P52,500 C. P66,000 D. P126,000 b. How much is Pha Aviation's prepaid rent balance at December 31, 2019? A. P13,500 B. P23,500 C. P55,500
On August 1, 2019, Pha Aviation leased two helicopters from Wayo Aircraft for an initial period of 12 months with a provision for a continuation of a month-to-month basis. The lease is property classified under a low value asset. Lease payments are to be made as follows: 1 st two months - P15,000 per month Next three months - P12,000 per month Next three months - P10,000 per month Last four months - P 7,500 per month After the first year, the rent continues at P6,000 per month.
a. How much is Pha Aviation's rent expense for the year ended December 31, 2019?
A. P10,500
B. P52,500
C. P66,000
D. P126,000
b. How much is Pha Aviation's prepaid rent balance at December 31, 2019?
A. P13,500
B. P23,500
C. P55,500
D. P66,000
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