Solve and provide the correct answers according to the infromation in the photo;

REQUIRED:

Assuming spread-out method is used:

1. The rent income of ABC Company in 2020

2. The rent income of ABC Company in 2021.

3. Assuming the data given in the table pertains to the year 2022, compute the rent income of ABC Company in the year 2022.

Assuming outright method is used:

4. The rent income of ABC Company in 2020.

5. The rent income of ABC Company in 2021

6. Assuming the data given in the table pertains to the year 2022, compute the rent income of ABC Company in the year 2022.

Problem 4. ACCOUNTING FOR LEASE ASM Foods Inc. is a franchisee of MCDonalds Philippines in Butuan City. During the year 2020, it enters into a lease contract with ABC Company. The lease contract stipulates the following: - Monthly Rental is P 100,000.00 or 5% of the gross monthly sales whichever is higher. - An escalation rate of 10% per on the base rent every other year beginning 2022. - The lessee shall also shoulder the property taxes for the benefit of and on behalf of the lessor, in an amount of P50,000 per year. - ASM Foods Inc., the lessee, shall pay a 6-month advance and 2 months in security deposit, equivalent to P100,000.00 per month. - The lessee shall be allowed to construct a building, where the ownership of the building shall be transferred to the lessor upon the expiration of the lease, or upon termination whichever comes earlier. - The lease contract is for 15 years. - The lease may be terminated should the lessee fail to pay a 3 consecutive monthly rents. ASM Foods commence the rent beginning May 1, 2020, when it started the construction of the building. The building was completed and was fully functional beginning November 1 , 2020 , for a total construction cost of P47,510,000. The building was appraised to survive 20 years since the construction was completed. The salvage value of the property by the end of the 20th year is only P700,000. For the remaining of 2020, the sales of ASM Foods Inc. were only P 3,670,000.00. Quarterly sales for 2021 were as follows: The above sales were evenly earned during each quarter