On January 1, 2020, Venson Company enters into a ten-year lease of floor building. Lease payments are P1,000,000 per year all payable at the beginning of each year. To obtain the lease, Venson Company incurs initial direct cost of P500,000, of which P300,000 relates to payment to a former tenant occupying that floor of the building and P200,000 relates to a commission paid to the real estate agent that arrange the lease. As an incentive to Venson Company for entering the lease, the lessor agrees to reimburse to Venson Company the real estate commission of P100,000 and leasehold improvements of P120,000. Lessees incremental borrowing rate is 9% per annum, which reflects the fixed rate at which lessee could borrow an amount similar to the value of the right-of-use asset, in the same currency, for a ten year term and with similar collateral. The lessee is required to dismantle and restore the floor building at an estimated cost of P100,000 at the end of lease term. How much is the carrying value of the right-of-use asset as of December 31, 2021?

a. P5,949,990

b. P5,916,198

c. P5,910,465

d. P5,905,860