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Dear Tutor, based on the F6 note, the premium should be calculated like this premium x (51-lease time)/50, but in this question they calculate like this:Premium received 12,000
Less: 12,000 x 2% x (30 – 1) (6,960), would you please explain to me?
many thanksIf you have applied the method correctly you should establish the same answer as that is just a different way of deriving the same outcome where you deduct from the premium 2% for each year of the lease less1 – use whichever method you are happier with!
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