Reference no: EM132933311

On 1 July 20X1 Lessee Ltd leased some equipment from Lessor Ltd. The details of the lease arrangement are as follows:

1. Lessor Ltd acquired the equipment at fair value at the commencement of the lease
2. The lease term was 8 years
3. The interest rate implicit in the arrangement was 3%
4. The lessee paid an amount of $40,000 per annum to the lessor. The first payment was made on 30 June 20X2. Subsequent payments were made on 30 June each year
5. Included in the annual payment of $40,000 was an amount of $7,000 for repairs and maintenance that Lessor Ltd had agreed to pay to external contractors on behalf of Lessee Ltd
6. The residual value at the end of the lease term was $16,000. All of the residual was guaranteed by the lessee.
7. $1,000 of the residual value guarantee was expected to be payable by the lessee to the lessor at the end of the lease term
8. The lessee will retain the asset at the end of the lease term The lessor paid initial direct costs of $1,514 at the commencement of the lease
9. The lease is classified as a finance lease by the lessor

Required:

Problem 1: Write in the box below the amount that would be recognised by Lessor Ltd as the Lease Receivable at the commencement of the lease in accordance with the requirements of AASB 16: Leases. Do not include any spaces, commas, dollar signs or decimals when you write your answer below.