Illustration 3 @c

the
Lestein :

Leasy
Sicom-hom 1

austerin
-

(2) The rake the lease

implicit in

is that rate which

druts
the future economic
benefits
attributable to He lessur
[lease
Prymets + Residual back otne]
*
In Be investment made
by the

lesser of start of the lease

*
includesov of the Un
t

Any chreet asts incurred

the lessor
by
Therefore mathematically :
 of future
Pr benefits econ

Inv
-
for the lessur
P sar
I
Bri
30/6)2)
Grz ......... -
Br5 Br

a+
30/6)22 30 5
2
sul/25
1/7/20 LP, LPz
Souvo
S RY
Ry
y
Artdoore
+
358150 -
+....

,
- -

+ 5
(

&
r)'(1 + r)2
00v +

50
rate the
implicit in

lease = effective 10 I

pe to He less or -
IRR

of Trial value
↳a %
3

Inv crear
Po of future benefits
-
-
NPV
lesson
my

[
-gi)] - 6150 =
+38357
+ 228985 ↓
imp disation ?
or
is 172522
r > 3
%
[0
507
-
,- -
 kind
yof 7 % a
rate

[Lost I
rot]-565
e
: -
⑪

↓
15543

implication?
r (7 %

Conclusion :

3" Cr (7 %
.

Usy the IRR

interpolation formula
to
compute/estimate the rate

implicat in the lease :

r = LDR +
[R-LD12X
NPR
e3
 [5513) 3832)
I
3
x
,

84653 %
=

8 .

~%
·
-
85

(b) Does te Contract contain a

&

lease ?
because :
The
yes
ans is

(i) There an
identified asset

(building)has control
(ii) The lisse ove

the
use of the
building fora
Sched
& of 5
yrs .

Therefore at the steet of the

lease the lessed must
,
recognise
a
Right of Use
building
t

Lease
Liability = P ofthe
lessee's

obligations
;

lease
, sagents
t GRY
any
usin a

M which

is eithe
[IARS16) :

(is the Lessee's incremental

borrowi rate .
 (ii) the
rake implicit in

the lease .
(i 5 85%)
.
e
.

Therefore the books of the lesser

(
in

Hom) at I

July
2020
(black of
The
lease) :

L
-
of [15,
Dr Right 000 +
21145)
226480
I
use
building
heave *
Cr
hinktiy
211 480
,

Banks
Cr
(20 ,
000 -

5000) 15 our

* lease
PV of the lessee's minimum

GRD)
proyments (lease payment +
<my
.
 Pr of have mits
Lease hieb
1
1pay
+ > Bri Brs
Tly
T
c

zuzu Servo .......

+ 50 ru

T05851
-

1 -
0585

sirox
[
I

5irvox
[0525e
I

I
- 50
,
ro x 4 .
2296

·450
#
I

Must be
paid off
Amortized
· We rust
propere
a lease him Amortisation
 teblen .

Amortisation Table
CP
-
Lease
himbality Lesse hease Lease
heare Intcost
Year Lic · end peymt
Ond
hieb
peid
hi
Ond
at start
) (Amortised
%

<5 85
.

back
.

--------------
cast]
17pr-3r/6/21 211480
/
12372
C
50
,
rus 37628 173852
I

b
I

- ........
39830134022
1721-30/6/2173852
8
10170 ,
our

CL NCL

(d) Journal entries boates of in

-esee of
30/6/2021
~
DepE expuse
[80)
Dr
2
,
45

CONL)
296
Cr
Acc-dup 45
,

~ Dr Intast (PNL) 12
,
372
 Dr Luasehimb . 37 628
,

Cr Benk 50
,
ove

(2) Extract
of He
B)s of HOM

#Junel 2021

ment lines
·
Roll
Buildi [226480 45296 181184
-

hinbiltug
---

Non-errent his
- - -

Leasehibility- 134
[211480
3
173852 022
-37628 =

hind
/ ,

39830
-

Current 1

--

Current portin of
 hirsuty
He less :
(+ 39830) 39 830
,

#73
852
,

17
- -