How much rent revenue should Aguila recognize

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Question 1 - On January 1, 2016 A Corporation signed a ten-year operating lease for an office space at P960,000 per year. The lease included a provision for additional rental payment of 5% of annual company sales in excess of P5,000,000. Lessee's sales for the year ended December 31, 2016 were P6,000,000. Upon execution of the lease, A Corporation received P240,000 as a bonus for the lease. How much rent revenue should Aguila recognize in profit or loss?

Question 2 - On January 1, 2022, A Company leased out a building to B Company under an operating lease for ten years at P500,000 per year, payable the first day of each lease year. A Company paid P150,000 to real estate broker as a finder's fee. The building is depreciated P120,000 per year. For 2022, A incurred insurance and property tax expense totaling P90,000. The net income to be reported by A is?

Reference no: EM133063457

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