Boney plc entered into a contract with Rub Limited for the lease of 100 treatment benches. Each bench is considered to be an identified underlying asset. The commencement date of the lease is 1 April 20X5 and Boney plc paid legal costs relating to setting up the lease of 2 203 on this date. The lease agreement is for a period of three years and requires total lease payments in arrear as follows: Date

Date	$
31/03/x6	10,000
31/03/X7	11,000
31/03/X8	12,000

The estimated useful life of the benches is three years with no residual value. Boney plcs incremental borrowing rate is 10%. The following present value (PV) table is provided:

	PV factor
Present value of 1 in one year, discounted at 10%	0.9091
Present value of 1 in two years, discounted at 10%	0.8264
Present value of 1 in three years, discounted at 10%	0.7513
Present value of annuity in arrear of 1 for three years, discounted at 10%	2.4868

The financial year end of Boney plc is 31 March. Part A Assume that the contract contains a lease and the IFRS 16 Leases single lease model is applied. Required: a) Prepare all the relevant journal entries in relation to the lease contract in the accounting records of Tree Tops plc for the year ended 31 March 20X6 only. (14 marks) b) Prepare an extract from the statement of financial position showing the disclosure of the right of use asset and the lease liability at 31 March 20X7 together with the comparative amounts at 31 March 20X6. (7marks)

Part B Assume that the low value asset exemption of IFRS 16 Leases is applied. Required: Prepare the journal entries in relation to the lease contract in the accounting records of Boney plc for the years ending 31 March 20X6 and 20X7 only. (5 marks) Part C Lumber plc is a diversified company, owning four properties in the South-West.

Property
a	An office building in Exeter. Lumber plc leases the entire building to a professional services company and also provides security services to the lessee who occupies this building.
b	A hotel building in Falmouth. Lumber plc leases the hotel building to a local hotel operator. The contract provides that Lumber plc receive a fixed monthly rental, 50% of votes regarding management of the hotel and a 20% share in hotel profits.
c	A 10-story building in Bristol. Lumber plc leases out 3 floors and uses the top 7 floors as the entitys head office. It is not possible to sell any of the floors separately.
d	A small retail park outside Truro. The retail park has five separate units. Lumber plc occupies one of the units and leases the other four units to various retailers.

Required: Briefly explain, with reasons, how Lumber plc should classify each of these properties for reporting purposes in accordance with the International Financial Reporting Standards. (9 marks)