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Provisions

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Provisions

  • This topic has 1 reply, 2 voices, and was last updated 3 years ago by P2-D2.
Viewing 2 posts - 1 through 2 (of 2 total)
  • Author
    Posts
  • May 25, 2022 at 12:56 am #656397
    ilham9089
    Participant
    • Topics: 301
    • Replies: 190
    • ☆☆☆

    Brum Ltd is leasing an office building for which it has
    no further use. However, the lease contract is non-
    cancellable and the office building cannot be sub-let to
    a third party.

    Why do we setup a provision for this?

    May 30, 2022 at 4:43 pm #656882
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 7231
    • ☆☆☆☆☆

    You set up a provision for the onerous contract. In this instance the provision would be for the remaining amounts on the lease.

    Thanks

  • Author
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