Examlex
On January 1st, 2014, ABC Inc.(the lessor) agrees to lease a piece of specialized piece of machinery to DEF Inc.(the lessee) for 5 years.ABC Inc.is a financial intermediary specializing in leasing arrangements such as the one described below.Details are as follows: Fair value of machinery at inception of the lease: $100,000.Lease term: 5 years (no bargain renewal terms) .
Executory costs of $10,000 are reimbursed by the lessee.
5 Annual lease payments of $23,000 each are made on January 1st of each year starting on January 1st, 2014.
Bargain purchase option at end of lease: $5,000.It is estimated that the equipment will have a fair value of $10,000 at the end of the lease.
Economic life of the asset is 10 years, after which the equipment will be worthless.Straight-line depreciation applies.
ABC's implicit interest rate with respect to this lease is 10%.This is rate is known by DE Inc.
DEF Inc's incremental borrowing rate is 9%.
Assuming that this qualifies as a finance lease, what would be the amount of DEF Inc's annual depreciation as per IFRS (rounded) ?
Organic Reaction
A chemical reaction involving organic compounds where molecules may break apart, recombine, or rearrange to form new substances.
Organic Reaction
A chemical reaction involving organic compounds, where covalent bonds between carbon atoms are made or broken in the presence of other atoms.
Organic Reaction
A chemical reaction involving organic compounds, where these compounds are typically based on carbon.
Diels-Alder Reactions
A chemical reaction between a conjugated diene and a dienophile to form a cyclohexene derivative.
Q26: Choose the correct statement regarding including the
Q44: KAR Ltd.has been in business for five
Q49: A company will show the same income
Q50: Steps in calculating diluted EPS include the
Q58: Employees are not allowed to make contributions
Q84: You are analyzing the balance sheet of
Q95: You are given the following information about
Q102: The bifurcation of the proceeds from the
Q124: On January 1, 2014, Ryan Ltd.purchased equipment
Q177: Both guaranteed and unguaranteed residual values should