On January 1, 2019, Travel Corporation signed an 8-year operating lease for office space at P300, 000 per year. The lease included a provision for additional rent of 5% of annual company sales in excess P2, 000, 000. Travel’s sales for the year ended Dec. 31, 2019 were P2, 500, 000. Upon execution of the lease, Travel Corporation paid P100, 000 as a bonus for the lease. Travel’s rent expense for the year ended Dec. 31, 2019 is 300,000 312,500 325,000 337,500
On January 1, 2019, Travel Corporation signed an 8-year operating lease for office space at P300, 000 per year. The lease included a provision for additional rent of 5% of annual company sales in excess P2, 000, 000. Travel’s sales for the year ended Dec. 31, 2019 were P2, 500, 000. Upon execution of the lease, Travel Corporation paid P100, 000 as a bonus for the lease. Travel’s rent expense for the year ended Dec. 31, 2019 is 300,000 312,500 325,000 337,500
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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. On January 1, 2019, Travel Corporation signed an 8-year operating lease for office space at P300, 000 per year. The lease included a provision for additional rent of 5% of annual company sales in excess P2, 000, 000. Travel’s sales for the year ended Dec. 31, 2019 were P2, 500, 000. Upon execution of the lease, Travel Corporation paid P100, 000 as a bonus for the lease. Travel’s rent expense for the year ended Dec. 31, 2019 is
300,000
312,500
325,000
337,500
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