The Following Information Relates to Questions

question 25

Multiple Choice

The following information relates to questions
Adam Limited and Davies Limited enter into a finance lease agreement with the following terms:

? lease term is 3 years
? estimated economic life of the leased asset is 6 years
? 3 × annual rental payments of £23 000 each payment is one year in arrears
? residual value at the end of the lease term is not guaranteed by the lessee
? interest rate implicit in the lease is 7%.

-The period over which the asset should be depreciated by the lessee is:

• A) 3 years;
• B) 6 years;
• C) the rate as determined by the tax authorities;
• D) cannot be determined from the information provided.

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Definitions:

Subjective Norms

The perceived social pressure to perform or not perform a particular behavior, influenced by the beliefs of significant others.

Cultural Roadblocks

Obstacles or barriers created by differences in cultural practices, beliefs, and values that hinder communication, understanding, or progress in various contexts.

Extended Fishbein Model

An advanced version of the Fishbein model that incorporates additional variables to predict behavior more accurately, focusing on attitudes and the subjective norm towards an action.

Original Model

is the initial instance or prototype from which copies are made or from which something develops or evolves.