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On 1 January 2019, Time Limited entered into a four-year contract to lease a machine. The annual lease payments are 20,000, payable in arrears on
On 1 January 2019, Time Limited entered into a four-year contract to lease a machine. The annual lease payments are 20,000, payable in arrears on 31 December each year. The interest rate implicit in the lease is 10%. There were no initial direct costs. The first lease instalment was paid on 31 December 2019. Time Limited calculates depreciation on a straight-line basis and the machine is expected to have no residual value at the end of the lease term. Requirement Based upon the information provided above, prepare extracts for the financial statements of Time Limited for the year ended 31 December 2019 in accordance with IFRS 16 Leases. Q1 What is the total value of the lease liability on 31 December 2019 in accordance with IFRS 16 Leases? Group of answer choices 60,000 80,000 69,718 49,718 Q2 What is value of the current lease liability on 31 December 2019 in accordance with IFRS 16 Leases? Group of answer choices 34,690 18,180 49,718 15,028
On 1 January 2019, Time Limited entered into a four-year contract to lease a machine. The annual lease payments are 20,000, payable in arrears on 31 December each year. The interest rate implicit in the lease is 10%. There were no initial direct costs. The first lease instalment was paid on 31 December 2019.
Time Limited calculates depreciation on a straight-line basis and the machine is expected to have no residual value at the end of the lease term.
Requirement
Based upon the information provided above, prepare extracts for the financial statements of Time Limited for the year ended 31 December 2019 in accordance with IFRS 16 Leases.
Q1
What is the total value of the lease liability on 31 December 2019 in accordance with IFRS 16 Leases?
Group of answer choices
60,000
80,000
69,718
49,718
Q2
What is value of the current lease liability on 31 December 2019 in accordance with IFRS 16 Leases?
Group of answer choices
34,690
18,180
49,718
15,028
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