Question
On 1 October 2020 Root Co hired a machine under a four-year lease. A deposit of 500,000 was payable on the commencement of the
On 1 October 2020 Root Co hired a machine under a four-year lease. A deposit of 500,000 was payable on the commencement of the lease on 1 October 2020. The present value of the future lease payments was 1,361,624. A further three instalments of 500,000 are payable annually in advance every year on 1 Oct starting from 2021. The interest rate implicit in the lease is 5%. What amount will appear under non-current liabilities in respect of this lease in the statement of financial position of Root Co at 30 September 2022? [Answers to nearest '000] 500,000 O 930,000 O476,000 O 976,000
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