BASEL HAS ACQUIRED A PLANT UNDER A FINANCE LEASE ON THE FOLLOWING TERM:

A. PAYMENT OF 100,000 IS TO BE MADE EVERY SIS MONTHS IN ADVANCE

B. FIRST PAYMENTS IS TO BE MADE ON 1 JANUARY X2

C. THE LEASE PROVIDES FOR A TOTAL OF TEN INSTALMENT PAYMENTS.

D. FAIR VALUE OF THE ASSET IS 810,000

E. ECONOMIC LIFE OF THE ASSETS IS SIX YEAR

F. AT THE END OF THE LEASE PERIOD, TITLE TO THE PLANT IS TO PASS TO BASEL.

G. INTEREST RATE IN THE LEASE IS 10% PER ANNUM.

H. LESSEE IS TO INCUR INITIAL DIRECT COST OF 10,000