The methods are some of the problems of a lease transaction that require you to make an analysis and provide justification based on MFRS 16 Lease.

Syarikat Tenara Bhd has entered into a lease contract for one lot for office use at One Bangi Mall for 5 years. The total floor rent is RM185,500 per year or equivalent to 5% of the company's total operating budget per year. The company decided not to record this transaction as a finance lease because it was low value based on the percentage of the budget.