X Time Limit: 1:30:00 Time Left:1:29:22 Muhammad Ahmad: Attempt 1 Page 1 Ancie Galang Question 1 (11 points) Tri-Facet Ltd., which follows IFRS, is a manufacturer of graders. On January 1, 2021, Tri-Facet Ltd. leases a grader to Multi-Task Corporation under a 8-year non- cancellable lease agreement. The following information about the lease and the grader is provided: 1. Equal annual payments (dud on January 1 each year) will be payable, to provide Tri-Facet with a 8% return on its investment. 2. The grader will revert to the lessor at the end of the lease. At the end of the lease term, the grader is expected to have a residual value of $31,400, which is rot guaranteed, 3. Lanuary 1, 2021, the fair value of the grader is $501.500. The cost of the grader to Tri-Facet Ltd. is $245,900. The grader has an expected useful life of 9 years. 4. Tri-Facet's year end is December 31. Required: 1. Using all the IFRS criteria and the information provided determine what specific type of lease this is for the lessor, Tri-Facet Ltd. (2 marks) 2. Calculate the annual lease payment. Round to the nearest dollar. (2 marks) 3. Prepare a lease amortization schedule for Tri-Facet Ltd, for the first 3 years of the lease. (2 marks) 4. Prepare journal entries for Tri-Facet Ltd. for 2021 to record the inception of the lease agreement, the receipt of the first lease rental payment, and any year end adjusting entries. Round all amounts to the nearest dollar. (5 marks) Click on the following link to access the dropbox you will use to submit your answer to this question: ACCT 221W Quiz 5 X Time Limit: 1:30:00 Time Left:1:29:22 Muhammad Ahmad: Attempt 1 Page 1 Ancie Galang Question 1 (11 points) Tri-Facet Ltd., which follows IFRS, is a manufacturer of graders. On January 1, 2021, Tri-Facet Ltd. leases a grader to Multi-Task Corporation under a 8-year non- cancellable lease agreement. The following information about the lease and the grader is provided: 1. Equal annual payments (dud on January 1 each year) will be payable, to provide Tri-Facet with a 8% return on its investment. 2. The grader will revert to the lessor at the end of the lease. At the end of the lease term, the grader is expected to have a residual value of $31,400, which is rot guaranteed, 3. Lanuary 1, 2021, the fair value of the grader is $501.500. The cost of the grader to Tri-Facet Ltd. is $245,900. The grader has an expected useful life of 9 years. 4. Tri-Facet's year end is December 31. Required: 1. Using all the IFRS criteria and the information provided determine what specific type of lease this is for the lessor, Tri-Facet Ltd. (2 marks) 2. Calculate the annual lease payment. Round to the nearest dollar. (2 marks) 3. Prepare a lease amortization schedule for Tri-Facet Ltd, for the first 3 years of the lease. (2 marks) 4. Prepare journal entries for Tri-Facet Ltd. for 2021 to record the inception of the lease agreement, the receipt of the first lease rental payment, and any year end adjusting entries. Round all amounts to the nearest dollar. (5 marks) Click on the following link to access the dropbox you will use to submit your answer to this question: ACCT 221W Quiz 5
