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How much is the net investment in the lease at december

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Question 1 - On December 31, 2022, Sarma Company leased equipment to Shane Company for a four-year period ending December 31, 2026. The equipment cost Sama 365,760 and has an expected useful life of five years. Its normal sales price is P365,760. The lessee guarantees the residual value of P80,000. Lease payments is due every December 31 and Shane Company made the first payment on December 31, 2022. Sarma's implicit interest rate is 10%. How much interest revenue should Sama recognize over the four-year lease term?

Question 2 - On December 31, 2022, Sarma Company leased equipment to Shane Company for a four-year period ending December 31, 2026. The equipment cost Sara 365,760 and has an expected useful life of five years. Its normal sales price is P365,760. The lessee guarantees the residual value of P80,000. Lease payments is due every December 31 and Shane Company made the first payment on December 31, 2022. Sarma's implicit interest rate is 10%. How much is the net investment in the lease at December 31, 2022?

Reference no: EM133134494

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