Carsons Ltd entered into the following lease agreement on the 1 January 2020: To produce a new foiled Christmas product, a new printing and folding machine was leased and received on 1 January 2020. The plant is held within the main warehouse operated by the company and required a complex installation that was completed and settled on 1 January 2020 at a cost of £35,000. The new plant is to be leased for 7 years at an annual rental payment of £350,000, payable on 31 December of each year. To delay receipt of the plant until 1 January 2020, the lessor paid a £20,000 incentive to Carsons Ltd which was received on 1 January 2020. The implicit rate of the lease is 8%. Help show how the information can be accounted for and adjusted into the finacial statements according to IFRS

Carsons Ltd entered into the following lease agreement on the 1 January 2020: To produce a new foiled Christmas product, a new printing and folding machine was leased and received on 1 January 2020. The plant is held within the main warehouse operated by the company and required a complex installation that was completed and settled on 1 January 2020 at a cost of £35,000. The new plant is to be leased for 7 years at an annual rental payment of £350,000, payable on 31 December of each year. To delay receipt of the plant until 1 January 2020, the lessor paid a £20,000 incentive to Carsons Ltd which was received on 1 January 2020. The implicit rate of the lease is 8%. Help show how the information can be accounted for and adjusted into the finacial statements according to IFRS

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 1E: Determining Type of Lease and Subsequent Accounting On January 1, 2019, Caswell Company signs a...

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