Compute for the carrying value of the right of use asset

Assignment Help Accounting Basics

Reference no: EM132807995

Problem 1: On January 1, 2020 an entity entered into a lease for commercial space with the following information: Annual rental payable at the end of each year P200,000; Lease term for 5 years; Implicit rate in the lease for 9%. On January 1, 2022, the entity and the lessor agreed to amend the original lease by extending the lease by 3 more years with the following information: Annual rental payable at end of each year beginning December 31, 2022 for P200,000 and an implicit rate in the lease for 11%. Compute for the carrying value of the right of use asset on December 31, 2022. (Use four decimal places for your present value ex:1.3284)

Option 1: 806,658
Option 2: 466,800
Option 3: 672,215
Option 4: 622,400

Reference no: EM132807995

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