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Hi, need help for the following question thank you.
During the y.e 31 Mar x5, Delight entered into two lease transactions:
– on 1 Apr x4, a payment $80,000 being the first of five equal annual payments of a finance lease for an item of plant. The lease has an implicit interest rate of 10% and the fair value (cost to purchase) of the leased equipment on 1 Apr x4 was $333,600.
– on 1 Nov x4, payment of $12,000 for a one yr lease of an item of packaging equipment.
What amount in total would be charged to SOPL for ye 31 Mar x5?
charges will be 3 parts :- first from the interest charge for the first year finance lease which will be 333,600 – 80,000 = 253,600 interest charge 10% so it will be 25,360
second will be depreciation of leased plant :- 333,600 / 5 = 66,720
third is operating lease :- 12,000 * 6/12 = 6000
so the total will be (25360+66720+6000)
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