Oman Cables Company purchased 40% of the outstanding voting shares of Oman Flour Mills for OMR 5,000 cash. This investment gives Oman Cables Company significant influence over the operations of Oman Flour Mills. At the end of the year Oman Flour Mills paid dividends of OMR 1,000. What is the journal entry for the dividends received by Oman Cables Company from Oman Flour Mills?

a.

Dr. Cash Cr. Investment

b.

Dr. Investment Cr. Cash

c.

Dr. Dividends Cr. Cash

d.

Dr. Cash Cr. Dividends

The lessor and the lessee entered into a lease agreement on 1 January 2019. On that date, the lease liability recorded by the lessee was OMR 40,000. The interest rate is 10%. The amount of interest expense to be recognized on 31 December 2019 is:

a.

Amount cant be determined

b.

OMR 4,000

c.

OMR 40,000

d.

OMR 400

HSBC purchased 3,000 shares of Dhofar Bank at OMR 0.500 per share as Available for Sale investment. Transaction cost of OMR 120 is charged to net income. The amount of investment that will be debited in the books of HSBC is:

a.

OMR 1,500

b.

OMR 1,380

c.

OMR 500

d.

OMR 1,620

Al Noor Company enters into a 10-year lease of equipment on 31 December 2019. The annual lease payment is OMR 1 million. The present value of minimum lease payments is OMR 4 million and the fair value of the asset is OMR 5 million. How much will be recorded by Al Noor as leased asset on 31 December 2019?

a.

OMR 1 million

b.

OMR 5 million

c.

OMR 6 million

d.

OMR 4 million