State whether the following contracts are considered leases under PFRS 16. Why or why not?Customer enters into a 15-year contract with a utilities company (supplier) for the right to use three specified, physically distinct fibres within a larger cable connecting Hongkong to Tokyo. 2. Customer enters into a contract with a property owner (supplier) to use a retail unit A for a five-year period. Retail unit A is a part of larger retails space with many units. 3.Customers into a contract with supplier for the use of truck for one week to transport cargo from Manila to Baguio.

A lease is a type of contract between two parties in which one party the owner of the asset gives…

Answered: State whether the following contracts…

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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State whether the following contracts are considered leases under PFRS 16. Why or why not?

Customer enters into a 15-year contract with a utilities company (supplier) for the right to use three specified, physically distinct fibres within a larger cable connecting Hongkong to Tokyo.

2. Customer enters into a contract with a property owner (supplier) to use a retail unit A for a five-year period. Retail unit A is a part of larger retails space with many units.

3.Customers into a contract with supplier for the use of truck for one week to transport cargo from Manila to Baguio.

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