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Bulwell Aggregates Co entered into a 3 year contract to obtain 3 lorries on 1 January 20X1. The contract met the IFRS 16 criteria to be classified as a lease
and the intitial measurement of the right of use asset was $54,000. The agreement states that Bulwell Aggregates will pay a deposit of $9,000 on 1 January 20X1, and
two annual instalments of $24,000 on 31 December 20X1, 20X2 and a final instalment of $20,391 on 31 December 20X3. Ownership will pass to Bulwell at the end of the lease term.

Interest is to be calculated at 25% on the balance outstanding on 1 January each year and paid on 31 December each year.

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