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Part A Contract A Star Bhd enters into an agreement with Quest Bhd to rent of 10 cars for 3 years starting January 2020. Star
Part A Contract A Star Bhd enters into an agreement with Quest Bhd to rent of 10 cars for 3 years starting January 2020. Star Bhd will pay Quest Bhd RM 200 000 per year starting January 2020. The lease stated that Star Bhd have option to use any of the cars to be used by the company and which cars to be used for particular customer. If there are no customers, all 10 cars will be kept at Star Bhd premises. If any of the cars being service, Quest Bhd are required to replace it with another car to be used by Star Bhd. Contract B Star Bhd also entered an agreement with Galaxy Bhd to rent 5 lorries for 4 years starting June 2020 to transport their good to customers. The contract stated that Galaxy Bhd will determine the types and quantity to be transported by the lorries. The lorries will be kept at Galaxy premises if not being used for transporting Star Bhd. Galaxy Bhd also can use the lorries to transport other companies' goods if not being used for Star Bhd over the rental agreement. Required: Explain briefly if contract A and B entered by Star Bhd contain lease based on MERS 16 Leases
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