J.

Gonzales

DERIVATIONS Accounting for Leases

No.

Answer Derivation

1.

P4,000,000 6.14457 = P650,981 (PV of Ordinary Annuity Table).

2.

P650,981 + P10,000 = P660,981.

3.

Conceptual.

4.

Conceptual, FV exceeds cost.

5.

P4,000,000 10 = P400,000.

6.

8/10 = .8 > 75% of economic life.

7.

Conceptual.

8.

P40,000
P400,000
= 10% or = 6.1446*
P400,000
P65,098.13
*6.1446 = PV factor of ordinary annuity of P1 for 10 years at 10%.

9.

[(P400,000 P40,000) 15] + P37,490 = P61,490.

10.

P316,925

11.

(P400,000 P360,000) 15 = P2,667.

12.

$6, 000, 000 1

= P300,000.

10
2

(P6,000,000 P828,000) .04 = P206,880.

13.

P6,000,000 P5,200,000 = P800,000.

(P6,000,000 P828,000) .04 = P206,880.

14.

[P600,000 (P60,000 .50663)] 4.60478 = P123,698.

15.

(P80,000 3.99271) + (P50,000 .68508) = P353,671.

16.

(P80,000 3.99271) + (P50,000 .68508) = P353,671.

P80,000 (P353,671 .08) = P51,706.

17.

(P80,000 3.99271) + (P50,000 .68508) = P353,671

P80,000 (P353,671 .08) = P51,706
(P353,671 P51,706) .08 = P24,157 Interest exp.

18.

P900,000.

J. Gonzales

19.

P900,000 P80,000 P450,000 = P370,000.

20.

P310,426 2.48685 = P771,983;

P771,983
= 96% > 90%.
P800,000

21.

Conceptual.

22.

P800,000 [P310,426 (P800,000 .1)] = P569,574.

P310,426 (P569,574 .1) = P253,469.

23.

Fails to meet Group II requirements.

24.

Fair value = P800,000.

25.

Conceptual.

26

P129,057 3.57710 = P461,650.

27.

P129,057 3.57710 = P461,650

(P461,650 P129,057) .08 = P26,607.

28.

P129,057 3.57710 = P461,650

P129,057 [(P461,650 P129,057) .08] = P102,450.

29.

P129,057 3.57710 = P461,650

(P461,650 0) 4 = P115,413.

30.

P650,000 (650,000 .40) = P390,000

31.

(P650,000 .90) 3.99271 = P146,517.