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On 1 January 20x1, Manja Bhd enters into a finance lease agreement with Alpha Leasing Bhd for the use of a machine. The agreement calls
On 1 January 20x1, Manja Bhd enters into a finance lease agreement with Alpha Leasing Bhd for the use of a machine. The agreement calls for five yearly installments of RM25,000 each, with the first payment due on 31 December 20x1. The machine could be bought outright for cash of RM100,000. The interest rate implicit in the lease is not readily determinable. Manja Bhd's incremental borrowing cost is 10% per annum. Initial direct costs incurred by Manja Bhd are RM1,000. Required: Calculate the amount that Manja Bhd shall record at the commencement of the lease
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