[40] Now assume for this Question that the lease agreement contained a bargain purchase option of $18,000 at the end of the lease term instead of a residual value of $23,600. Further assume that WIN recorded the leased asset at $285,488 on January 1, 2019. What would be the amount for depreciation expense which WIN would record in 2019? [Round to the nearest dollar].

a.

$26,749.

b.

$28,738.

c.

$17,833.

d.

$19,033.

e.

None of the above

Not Ordinary Drones (NOD), Inc., a lessor, leased a drone to Worldz Information Network, Ltd., [WIN], a lessee, on January 1, 2019. The following information relates to the leased asset and the lease agreement: Fair value of leased drone $Undisclosed Lease 10 years Useful life 15 years Payment Due January 1 Payment frequency Annual Annual Instalments starting January 1, 2019 $33,000 Estimated residual value at end of the lease, [as stated in the problem] $23,600 Interest rate implicit in the lease (unknown to the lessee] 7% Interest rate incremental to the lessee 8% Ownership of drone reverts to lessor at end of lease term Year end for both companies December 31 Amortization method Straight line Accounting standards used - NOD ASPE - WIN IFRS REQUIRED: Select the one best answer to each of the questions listed below and input it in the computer