Questions 11 - 15 is based on the following information: Jozi Ltd entered into a non-cancellable lease on 1 January 2023 to lease a machine from Egoli Machines Ltd in order to perform excavation works on Jozi Ltd owned premises. Jozi Ltd did not elect the simplified accounting treatment for the machine and the year-end of the company is December. Egoli Machines Ltd made the underlying asset available for use by Jozi Ltd on 1 February 2023. The details of the lease agreement are as follows: Additional information: 1. Jozi Ltd made a payment to Egoli Machines Ltd relating to the design of the machine of R20 500 on 1 January 2023. 2. Legal fees of R3 500 to inspect the validity of the contract and initial direct costs of R8 500 (assemble and transport costs) were incurred by Jozi Ltd and they paid 50% of this in cash. Initial direct costs of R4 500 were incurred by Egoli Machines Ltd and was paid in cash on 1 February 2023. 3. Egoli Machines Ltd agreed to partially reimburse Jozi Ltd for the initial direct costs incurred to the lease contract to the value of R6 000 , to be received on 1 February 2024. This is classified as being a lease incentive to the lessee. 4. Jozi Ltd paid a non-refundable deposit of R10 500 on 25 May 2022 to secure the lease. 5. Jozi Ltd is required to pay an annual inspection fee of R3 500 on 31 December. 6. It was estimated that the future dismantling cost to be paid at the end of the lease term would be R15 500 . The pre-tax discount rate applicable to the dismantling provision is 10%. 7. Jozi Ltd accounts for right-of-use assets according to the cost model. 8. Ownership of the underlying asset will not transfer to the lessee at the end of the lease term and the cost of the right-to-use asset does not reflect that the lessee will exercise any purchase option. In calculating the implicit interest rate, the future value (FV) will be? 1. RO 2. R3 500 3. R110 000 4. R155000 Questions 11 - 15 is based on the following information: Jozi Ltd entered into a non-cancellable lease on 1 January 2023 to lease a machine from Egoli Machines Ltd in order to perform excavation works on Jozi Ltd owned premises. Jozi Ltd did not elect the simplified accounting treatment for the machine and the year-end of the company is December. Egoli Machines Ltd made the underlying asset available for use by Jozi Ltd on 1 February 2023. The details of the lease agreement are as follows: Additional information: 1. Jozi Ltd made a payment to Egoli Machines Ltd relating to the design of the machine of R20 500 on 1 January 2023. 2. Legal fees of R3 500 to inspect the validity of the contract and initial direct costs of R8 500 (assemble and transport costs) were incurred by Jozi Ltd and they paid 50% of this in cash. Initial direct costs of R4 500 were incurred by Egoli Machines Ltd and was paid in cash on 1 February 2023. 3. Egoli Machines Ltd agreed to partially reimburse Jozi Ltd for the initial direct costs incurred to the lease contract to the value of R6 000 , to be received on 1 February 2024. This is classified as being a lease incentive to the lessee. 4. Jozi Ltd paid a non-refundable deposit of R10 500 on 25 May 2022 to secure the lease. 5. Jozi Ltd is required to pay an annual inspection fee of R3 500 on 31 December. 6. It was estimated that the future dismantling cost to be paid at the end of the lease term would be R15 500 . The pre-tax discount rate applicable to the dismantling provision is 10%. 7. Jozi Ltd accounts for right-of-use assets according to the cost model. 8. Ownership of the underlying asset will not transfer to the lessee at the end of the lease term and the cost of the right-to-use asset does not reflect that the lessee will exercise any purchase option. In calculating the implicit interest rate, the future value (FV) will be? 1. RO 2. R3 500 3. R110 000 4. R155000