One of the most significant changes to the IFRS in recent years is the introduction of IFRS $16,$ which deals with lease accounting. This new standard replaced IAS $17,$ which had been in use for several decades.

Required:

a$.$ Describe three $(03)$ features that qualify a contract to be accounted for under IFRS $16$ Leases. $(4$ marks$)$

b$.$ On $1$ January $2023,$ F Company entered into a contract for the right to use a machine for four years. The contract meets the definition of a lease under IFRS $16$ Leases. F company paid a deposit of K$900,000\mathrm{.}00$ on the commencement of the lease on $1$ January $2023$ and a further $3$ instalments of K$600,000\mathrm{.}00$ are payable annually in advance. The present value of the future lease payments was $K1,671,100\mathrm{.}00$ at the commencement of the lease. The interest rate implicit in the lease is $9\%.$ What amount will appear under non$-$current liabilities in respect of this lease in the statement of financial position of $F$ company on $31$ December $2023?[3$ marks$]$

c$.$ Pemba Company entered into a contract to acquire the right to use an item of plant for a period of four years from $1$ April $2022.$ The contract meets the definition of a lease under IFRS $16$ Leases. The present value of the future lease payments on commencement of the lease was $K16,162,000$ which is also the initial carrying amount of the right$-$of$-$use asset. $P$ will also make three rental payments of $$7$ million per annum which are due to be paid in arrears on $31$ March each year. The useful life of the plant is deemed to be six years. There is an option to buy the asset at the end of the lease term. The interest rate implicit is $8\%$ per annum. What is the total charge to the profit or loss in respect of the lease at $31$ March $2023?(3$ marks$)$

$[$Total: $30$ Marks$]$