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Help me to solve it, thanks a lot ! Khana Khazana Bhd, an indian Spice mix manufacturer, leases a spice grinding machinery from Heavy Metal
Help me to solve it, thanks a lot !
Khana Khazana Bhd, an indian Spice mix manufacturer, leases a spice grinding machinery from Heavy Metal Bhd on 1 January 2010. The fair value of the asset was RM125,097. Other details pertaining the lease are as follows: Lease period 5 years RM30,000 Yearly installments, payable in advance on 1 January each year Interest rate implicit in the lease 10% At the end of the lease period, the machinery is to be returned to Heavy Metal Bhd. The expected economic life of the asset is 6 years with no residual value. Khana Khazana Bhd makes up its accounts to 31 December each year. The present value of an annuity of RM1 per period is as below: Period 10% 1 0.9091 2 1.7355 3 2.4869 4 3.1699 5 3.7908 Required: (a) Calculate the present value of minimum lease payment for the machinery. (3 marks) (b) Prepare a table of calculation of interest charge using the actuarial method. (5 marks) (c) Prepare the extracts of the statements of comprehensive incomes for the year ended 31 December 2010 and 31 December 2011 for Khana Khazana Bhd. (4 marks) (d) Prepare the extracts of the statements of financial positions as at 31 December 2010 and 31 December 2011 for Khana Khazana Bhd. (8 marks) Khana Khazana Bhd, an indian Spice mix manufacturer, leases a spice grinding machinery from Heavy Metal Bhd on 1 January 2010. The fair value of the asset was RM125,097. Other details pertaining the lease are as follows: Lease period 5 years RM30,000 Yearly installments, payable in advance on 1 January each year Interest rate implicit in the lease 10% At the end of the lease period, the machinery is to be returned to Heavy Metal Bhd. The expected economic life of the asset is 6 years with no residual value. Khana Khazana Bhd makes up its accounts to 31 December each year. The present value of an annuity of RM1 per period is as below: Period 10% 1 0.9091 2 1.7355 3 2.4869 4 3.1699 5 3.7908 Required: (a) Calculate the present value of minimum lease payment for the machinery. (3 marks) (b) Prepare a table of calculation of interest charge using the actuarial method. (5 marks) (c) Prepare the extracts of the statements of comprehensive incomes for the year ended 31 December 2010 and 31 December 2011 for Khana Khazana Bhd. (4 marks) (d) Prepare the extracts of the statements of financial positions as at 31 December 2010 and 31 December 2011 for Khana Khazana Bhd. (8 marks) Step by Step Solution
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