On January 1, 2020 an entity entered into a lease for commercial space with the following information: Annual rental payable at the end of each year P200,000; Lease term for 5 years; Implicit rate in the lease for 9%. On January 1, 2022, the entity and the lessor agreed to amend the original lease by extending the lease by 3 more years with the following information: Annual rental payable at end of each year beginning December 31, 2022 for P200,000 and an implicit rate in the lease for 11%. What is the carrying value of the right of use asset on December 31, 2022? a. 806,658 b. 466,800 c. 672,215 d. 622,400
On January 1, 2020 an entity entered into a lease for commercial space with the following information: Annual rental payable at the end of each year P200,000; Lease term for 5 years; Implicit rate in the lease for 9%. On January 1, 2022, the entity and the lessor agreed to amend the original lease by extending the lease by 3 more years with the following information: Annual rental payable at end of each year beginning December 31, 2022 for P200,000 and an implicit rate in the lease for 11%. What is the carrying value of the right of use asset on December 31, 2022? a. 806,658 b. 466,800 c. 672,215 d. 622,400
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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On January 1, 2020 an entity entered into a lease for commercial space with the following information: Annual rental payable at the end of each year P200,000; Lease term for 5 years; Implicit rate in the lease for 9%. On January 1, 2022, the entity and the lessor agreed to amend the original lease by extending the lease by 3 more years with the following information: Annual rental payable at end of each year beginning December 31, 2022 for P200,000 and an implicit rate in the lease for 11%.
What is the carrying value of the right of use asset on December 31, 2022?
a. 806,658
b. 466,800
c. 672,215
d. 622,400
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