Helpful pic is a finance company. It purchased computer equipment for R78 500 and leased it to Chatroom Ltd under a three year lease with three payments of R29 000 payable annually in advance. Chatroom Ltd agreed to also pay R830, which represented the cost of setting up the lease. What amount will be recognised in the Helpful pic balance sheet at the end of the first year? Select one: O a. R55 363 O b. R55 330 O c. R49 500 O d. R50 330

Helpful pic is a finance company. It purchased computer equipment for R78 500 and leased it to Chatroom Ltd under a three year lease with three payments of R29 000 payable annually in advance. Chatroom Ltd agreed to also pay R830, which represented the cost of setting up the lease. What amount will be recognised in the Helpful pic balance sheet at the end of the first year? Select one: O a. R55 363 O b. R55 330 O c. R49 500 O d. R50 330

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Helpful plc is a finance company. It purchased computer equipment for R78 500 and leased it to Chatroom Ltd under a three year lease with three payments of R29 000 payable annually in advance. Chatroom Ltd agreed to pay R830, which represented the cost of setting up the lease. At the end of the first year, the balance sheet reported a balance of R55 363. The implicit rate of interest is 10%. What amount will be recognised in the Helpful plc income statement as interest in the second year? Select one: a. R5 536 b. R2 636 c. R830 d. R29 000
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