New! Lectures for ACCA AAA September 2022 Exams are now available >>

New! BPP Books for ACCA September 2022 Exams are now available, get your discount code >>

Right of Use Asset value NOT equal to Lease Liability – double entry?

This topic has 2 replies, 2 voices, and was last updated 6 months ago by Darren.

Viewing 3 posts - 1 through 3 (of 3 total)

Author

Posts
December 22, 2021 at 2:36 pm #644698
Darren
- Topics: 10
- Replies: 9
Hi,

If I have:

Present Value of future lease costs = 10,250 and
Lease Administration Fee = 250
Then the Right of Use asset is 10,500

But the lease liability is 10,250.

If I

Debit Right of Use Asset 10,500
Credit Lease Liability 10,250

the entry doesn’t balance.

I don’t know how to post this entry?
December 23, 2021 at 8:00 am #644721
f6ali
Moderator
- Topics: 10
- Replies: 342
If you wish to ask the tutor directly then kindly start a thread in Ask the Tutor forums. This forum is for students to help each other.

The lease administration costs will presumably be paid for in cash, hence the credit entry will be in cash account.
December 23, 2021 at 10:32 pm #644752
Darren
- Topics: 10
- Replies: 9
Hi F6ali

I didn’t want to ask the tutor directly and this is why I posted in this forum.

But thank you for your advice.
Author

Posts

Viewing 3 posts - 1 through 3 (of 3 total)

You must be logged in to reply to this topic.