Determine the Fair Value (rounded off) of the leased asset.

needed: lease liabilityright of use of assetdepreciation expenseplease use a table for explaining lease liab.

Fitbit Ltd has leased a machine on the following terms:Date of entering lease 1 July 2019Duration of lease 5 yearsLife of asset 6 yearsUnguaranteed residual value $40,000Lease payments inception (at the start) $60,000Annual payments (5) $65,000Implied rate 11.0 % Required:Determine the Fair Value (rounded off) of the leased asset. (7 marks)

FRM Ltd acquired an item of equipment and enters into a non -cancellable lease agreement with FEN Equipment LTd on 1January 2015. The lease consists of the following: Date of inception.      1/1/15 Duration of Lease       4 years Life of Leased asset.   5 years Lease payments (annual)  $550000(annual) which includes $80000 for Maintenance and insurance costs per annum Guaranteed residual value (Added to final payment).                  $190000 Interest rate.                       7% Formula for PV of $1/(1+k)n Formula for present value of annuity of $1 per period for n periods= 1-1/(1+k)n /k Where k is the discount rate expressed in decimal Required 1. Determine the PV of minimum lease rental payment.  2. Prepare the journal entries for FRM Ltd (The lessee) using the Net method for the following  a) Transfer of control b) Payment of annual payments for 2015 and 2016.