Question (4): a) Jupiter plc prepares accounts to 31 December each year, entered into a finance lease agreement on 1 January 2020, to lease machinery. Jupiter plc agreed to make seven annual equal lease payments of 350,000 at the end of each year starting 31 December 2020. The implicit interest rate in the lease agreement is 10% per annum. Required: 1. Calculate the initial amount of the right-of-use asset and the lease liability at the commencement date (rounded). 2. Calculate the finance charge for the years 2020 and 2021 of the lease contract. 3. Prepare the required entries to account for the lease by Jupiter plc during the year to 31 December 2020 in accordance with IFRS 16. Assuming that sum- of-the-years'-digits is the method of depreciation used and the residual value is assumed to be nil. 4. Show the effect of the lease agreement on the financial statements of Jupiter plc for the year ended 31 December 2020 in accordance with IFRS 16. You are required to show all workings. (30 marks) b) Each of the following assets appears on Fortune's plc statement of financial position as at 31 March 2022: i. Equipment which cost 40,000, its written down value is 16,000 and at the end of its useful life its value expected to be nil. For tax purposes, the equipment's written down value is 11,200. ii. Interest Receivable of 3,000. This interest has been included in accounting profit but will not be taxed until it is received. It will be fully taxable. Assume that the tax rate 19%. Required: For each of these assets: 1. Compute the tax base of the asset and determine whether a temporary difference (taxable or a deductible) exist with respect to the asset. 2. Calculate the deferred tax asset (or liability) balance which will be shown in the statement of financial position in relation to the asset. You are required to show all workings. (20 marks)