Vim Company purchased an equipment on January 1, 2021 for P3,000,000 cash for the purpose of leasing it. The machine is expected to have a 10 year life from the date of purchase. On April 1, 2021, the equipment was leased to Eloisa Company for a 3 year period at a monthly rental of P40,000 payable at the end every month. Additionally, Eloisa Company paid P120,000 to Vim Company on April 1, 2021 as a lease bonus. Vim Company paid repairs of P20,000 relating to 2021.
Vim Company purchased an equipment on January 1, 2021 for P3,000,000 cash for the purpose of leasing it. The machine is expected to have a 10 year life from the date of purchase. On April 1, 2021, the equipment was leased to Eloisa Company for a 3 year period at a monthly rental of P40,000 payable at the end every month. Additionally, Eloisa Company paid P120,000 to Vim Company on April 1, 2021 as a lease bonus. Vim Company paid repairs of P20,000 relating to 2021.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Vim Company purchased an equipment on January 1, 2021 for P3,000,000 cash for the purpose of leasing it. The machine is expected to have a 10 year life from the date of purchase. On April 1, 2021, the equipment was leased to Eloisa Company for a 3 year period at a monthly rental of P40,000 payable at the end every month. Additionally, Eloisa Company paid P120,000 to Vim Company on April 1, 2021 as a lease bonus. Vim Company paid repairs of P20,000 relating to 2021.
1. Compute the net rent income of the lessor for 2021.
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