C Co acquired an item of plant under a lease on 1 January 2*19. The present value of the lease payments was $46,387,746 and the rentals are $18,000,000 per annum paid in arrears for three years on 31 December each year. The interest rate implicit in the lease is 8% per annum.1What amount will appear under non-current liabilities in respect of this lease in the statement of financial position at 31 December 2*19? (Answer to nearest $000)A. $14,288,980B. $15,432,099C. $16,666,667D. $18,000,000E. None of these answer choices are correct.

Non current liabilities are those liabilities which are not expected to be paid in next accounting…

Answered: C Co acquired an item of plant under a…

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter20: Accounting For Leases

Section: Chapter Questions

Problem 6E: Lessor Accounting Issues Ramsey Company leases heavy equipment to Terrell Inc. on March 1, 2019, on...

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C Co acquired an item of plant under a lease on 1 January 2*19. The present value of the lease payments was $46,387,746 and the rentals are $18,000,000 per annum paid in arrears for three years on 31 December each year. The interest rate implicit in the lease is 8% per annum.

What amount will appear under non-current liabilities in respect of this lease in the statement of financial position at 31 December 2*19? (Answer to nearest $000)

A. $14,288,980

B. $15,432,099

C. $16,666,667

D. $18,000,000

E. None of these answer choices are correct.

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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