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Problem 5. Operating Lease- Lessor On January 1, 2 0x1, Lessor entered into operating lease. an Information followS: Annual Rent payable at the end of each year P100,000 Lease bonus paid by lessee to lessor 20,000 Security deposit paid by the lessee to the lessor 15,000 Lease term 5 years Additional Information: Annual rent рayment includes P5,000 to Cover for costs of administrative tasks is to be paid for any excess of sales of Lessee over P1,000,000. Lessee's sales for 20x1 are P1, 100, 000. Additional rent of 10% The security deposit will be returned to Lessee at the end of lease term. The appropriate discount rate is 12% Annual depreciation on the leased asset is P70,000 Other costs related to the earning of lease income are P5,000 Requirements: Compute for the profit earned on the lease transaction in 20x1.

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BAAB2033 - Financial Accounting & Reporting 2 Topic 5: MFRS16 Leases Example 1 Think High Enterprise (THE), which makes up its accounts to 31 December each year. THE signed a lease contract with a less or, FDH. The lease contract gives THE, the right to control the asset. The date of the contract is 1/1/x2. The following are some of the terms. THE is to pay RM40,000 immediately, with three further yearly installments of RM40,000 each, beginning on 1/1/x3. The agreed fair value of the asset is RM139,474 & the interest rate implicit in the lease is 10%. At the end of the lease period the title to the asset is transferred to the lessee. The expected economic life of the asset is five years & the residual value of the asset at the end of that time is zero. You are required to record the above in the books of the lessee for the years ended 31 December x2, х3, х4 and х5. SHOT ON MI 10T

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Problem 5. Operating Lease- Lessor On January 1, 20x1, Lessor entered into an operating lease. Information follows: Annual Rent payable at the end of each year P100,000 Lease bonus paid by lessee to lessor 20,000 Security deposit paid by the lessee to the lessor 15,000 Lease term 5 years Additional Information: Annual rent рayment includes P5,000 to cover for Costs of administrative tasks Additional rent of 10% is to be paid for any excess of sales of Lessee over P1,000, 000. Lessee's sales for 20x1 are P1, 100, 000. The security deposit will be returned to Lessee at the end of lease term. The appropriate discount rate is 12% Annual de preciation on the leased asset is P70,000 Other costs related to the earning of lease income are P5,000 Requirements: Compute for the profit earned on the lease transaction in 20x1.

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PROBLEM NO. 3 Assume that DBP Leasing Corp. and Minasugbo Inc. sign a lease contract effective on January 1, 2019 where DBP Leasing leases to Minasugbo a bulldozer. The terms and provisions of the lease contract and other pertinent date are as follows: • The term of the lease is five years. The lease agreement is non-cancelable, requiring equal rental payments of P20,711.11 at the beginning of each year (annuity-due basis). The bulldozer has a fair value at the commencement of the lease of P100,000, an estimated economic life of five years, and a guaranteed residual value of P5,000. (Minasugbo expects that it is probable that the expected value of the residual value at the end of the lease will be greater than the guaranteed amount of P5,000.) The lease contains no renewal options. The bulldozer reverts to DBP Leasing at the termination of the lease. Minasugbo's incremental borrowing rate is 5 percent per year. • Minasugbo depreciates its equipment on a straight-line basis. DBP Leasing…

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How much should Thelma report as net investment in lease on December 31, 2022 statement of financial position?  a. P 291,049 b. P 320,154 c. P 321, 049 d. P 331, 049   please explain the answer and provide the solution in good accounting form.

Need help with subparts b-d Krawczek Company will enter into a lease agreement with Heavy Equipment Co. where Krawczek will make lease payments over the next five years. The lease is cancelable and requires equal annual payments of $33,600 per year beginning on January 1 of the first year. The last payment will be January 1 of year 5, and Krawczek will continue to use the asset until December 31 of that year. Other important information includes the following: The fair value of the equipment is $225,000. The applicable discount rate is an 8 percent annual rate. The economic life of the asset is 10 years. Krawczek does not guarantee the residual value of the asset at the end of the lease, and it does not expect to keep the asset at the end of the term. The asset is a standard piece of equipment. a. Is the lease an operating lease or a financing lease?   multiple choice Operating lease Financing lease b. What will be the lease expense shown on the income statement at the end…

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Problem 2 On January 1, 20X1, ABC Co. enters into a 4 year lease of office equipment. Annual rental payable at the end of each year is P 12,000. As inducement in entering into the lease, the lessor makes the first 3 months of the lease as rent-free. ABC Co. opts to use the practical expedient allowed under PFRS 16 for leases of low value assets. Provide journal entries.

PROBLEM #1 (Provide supporting computation for each sub questions) On January 1, 2020, the Lessee Company enters into a 3-year lease of office equipment. The annual lease payments which are made at the beginning of the year are as follows: 2020 160,000 2021 250,000 2022 300,000 As an inducement to enter the lease, the lessor granted the company the first 6 months of lease as rent free. The Lessor also incurred P30,000 initial direct cost to obtain the lease. The rate implicit in the lease is 10%. Case: Lessee Company assesses that the lease is a lease of underlying asset of low value and elect to apply the recognition exemption of PFRS 16. The office equipment was purchased by Lessor Company during December 2019 at P550,000. Lessor Company estimates that the useful life of the asset is 5 years with P50,000 residual value. Lessor pays repairs and maintenance of P5,000, P7,500 and P10,000, respectively for years 2021, 2022, 2023. a. What is the highest amount of net income from the lease…

What is the total cost of a 36 month lease with the terms ?

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Q25 Chad Ltd negotiated a lease on the following terms: the term of the lease was 5 years; the estimated useful life of the leased equipment was 10 years; the purchase price was R60 000; and the annual lease payment was R5 000. This lease should be classified as_____. Select one: a. A finance lease b. neither operating nor finance lease c. An operating lease d. a financial lease

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H1. Account 8% rate of return with annual rental payment of 81419

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Aa 02.

es On September 1, 2024, Custom Shirts Incorporated entered into a lease agreement appropriately classified as an operating lease. The lease term is three years. The annual payments by Custom Shirts are (a) $20,000 for year 1, (b) $24,000 for year 2, and (c) $28,000 for year 3. How much total lease expense will Custom Shirts recognize for 2024? Multiple Choice $20,000 $6,667 $8,000 $24,000

Question 1 lease Indicate each of the following statements as true or false. 1.→Lease Term refers to the fixed and cancelable term of the lease. 2.→Henry Company leases machines to Zoe Company. The contract states that the lease term is two years, with a rental payment of $10,000 per month. If Zoe continues to rent after the two-year term, the rental payment will be reduced to $1,000 per month for another two years. In this case, the real lease term is two years. 3.→Leasing equipment reduces the risk of obsolescence to the lessee and in many cases passes the risk of residual value to the lessor< 4.-In the event that it is practicable to determine the implicit rate, the lessee uses its incremental borrowing rate. 5.-If a lease does not transfer control of the asset over the lease term, the lessor will- generally account for the lease as a sales-type lease.

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Please answer part b,c,d and include workings on how you derive the amount. Please ensure that it is answered according to IFRS accounting standards.

Question Content Area A six-year operating lease requires annual rent payments of $15,000 for years 1, 2, and 3, and annual rent payments of $10,000 for years 4, 5, and 6. The agreement also requires the lessor to pay a $2,800 annual insurance premium for the leased property. Which of the following amounts should be recognized as the rental revenue in year 1 by the lessor? $10,000 $16,800 $15,000 $13,500

24.  Equal monthly rental payments for a particular lease should be charged to Rental Expense by the lessee for which of the following?   Capital Lease Operating Lease     a.   Yes            No b.   Yes            Yes c.   No             No d.   No             Yes      25.  On December 1, 2002, Blake Inc. signed an operating lease for a warehouse for ten years at $24,000 per year. Upon execution of the lease, Blake paid $48,000 covering rent for the first two years. How much should be shown in Blake's income statement for the year ended December 31, 2002, as rent expense? a. $0 b. $2,000 c. $24,000 d. $48,000