On January 2, 2021, Mr Smith company leased a machine from Mrs Smith Company. The the following information relates to the lease: Annual rental payable every January 1-------------------P500,000 Unguaranteed residual value ----------------------------- 50,000 Implicit interest rate in lease------------------------------- 12% PV of annuity of 1 in advance for 6 periods at 12%- 4.61 PV of single payment------------------------at 12% -0.5066 Lease term---------6 years ; Estimated useful life of the machine--- 8 years How much is the accumulated depreciation of the right of use asset at December 31, 2022?
On January 2, 2021, Mr Smith company leased a machine from Mrs Smith Company. The the following information relates to the lease: Annual rental payable every January 1-------------------P500,000 Unguaranteed residual value ----------------------------- 50,000 Implicit interest rate in lease------------------------------- 12% PV of annuity of 1 in advance for 6 periods at 12%- 4.61 PV of single payment------------------------at 12% -0.5066 Lease term---------6 years ; Estimated useful life of the machine--- 8 years How much is the accumulated depreciation of the right of use asset at December 31, 2022?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On January 2, 2021, Mr Smith company leased a machine from Mrs Smith Company.
The the following information relates to the lease:
Annual rental payable every January 1-------------------P500,000
Unguaranteed residual value ----------------------------- 50,000
Implicit interest rate in lease------------------------------- 12%
PV of annuity of 1 in advance for 6 periods at 12%- 4.61
PV of single payment------------------------at 12% -0.5066
Lease term---------6 years ;
Estimated useful life of the machine--- 8 years
How much is the
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