How much is the termination gain or loss on January

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Question - On January 1, 2020, Lunox Company entered into a Lease for floor space with the following information:

Floor Space 5000 square meters

Annual rental payable at the end of each year 200,000

Lease term 5 years

Implicit rate in the lease 10%

Present value of an ordinary annuity of 1 for 10% at 5 years 3.7908

On January 1, 2022 Lunox Company & the Lessor agreed to amend the original terms of the lease with the following information:

Floor space 3750 square meters

Annual rental payable after the end of each year 150,000

Implicit rate in the lease 8%

PV of an ordinary annuity of 1 for 8% at 3 periods 2.5771

Required - How much is the termination gain or loss on January 1, 2022?

Reference no: EM132904472

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