BPP online MOCK 2 question no. 25

Question:-
Elvis Co. is a relatively new business, incorporated on 1 oct 20×5. u are currently reviewing the 30 sept 20×7 year end result and the following two issues have arisen:
Issue1:
Elvis Co. required additional finance to help launch a new product. On 1 Oct 20×6 they issued a 6% $60 million convertible loan note at par. Interest is playable annually in arrears on 30 sept each year. the loan note is redeemable at par or convertible into equity shares at the option of the loan note holders on 20 sept 10×9. the interest on an equivalent loan note without the conversion rights would be 9% per annum.

the present values of $1 receivable at the end of each year, based on discount rates of 6% and 9% are:

6%
end of year 1 = 0.94
end of year 2 = 0.89
end of year 3 = 0.84

9%
end of year 1 = 0.92
end of year 2 = 0.84
end of year 3 = 0.77

Issue 2:
On 1 April 20×7 elvis co entered into an agreement for the right to use two specified items of equipment for 4 years from Zack co. the two items of the equipment have a fair value of $340000 in total. Zack Co. is responsible for the repairs and maintenance and must provide a temporary replacement in the equipment needs repairing or servicing Elvis Co. keeps the equipment on their premises and allocates work to the machines as part of their normal operations. there is no right to purchase the equipment at the end of the agreement. the equipment has an estimated useful life of 5 years.

The terms of the agreement include four equal installments of $100,000 payable in advance on 1 April each year. After the initial payment of $100,000 the present value of the remaining installments is $240,000.

What is the value of the non-current lease liability at the 30 Sept 20×7?

correct answer according to BPP:-

answer is $ 168,800.

Liablility at 1 april 20×7 = 240000
Interest($240000* 12%*6/12) = 14400
balance at 30 sept 20×7 = 254400
interest(240000*12%*6/12)=14400
payment = (100000)
capital balance due on 30 sept 20×8 = $168,800