What is the cost of right of use asset

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Problem 1: At the beginning of 2020, Trump Company leased an equipment with the following information: Annual rental payable at the end of each year P450,000; residual value guarantee P50,000; Lease incentive received P20,000; Lease term 4 years; Useful life of the equipment 8 years; implicit interest rate 10%; present value of an ordinary annuity of 1 at 10% for 4 periods 3.17; present value of 1 at 10% for 4 periods 0.68. What is the cost of right of use asset?

Option 1: P1,440,500

Option 1: P1,460,500

Option 3: P1,456,500

Option 4: P1,830,000

Reference no: EM132787629

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