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Problem 1: On January 1, 2020, an entity leased an equipment for four years at an annual rental of P170,000 payable at the end of each year. The estimated useful life of the equipment is four years. The present value factor of an ordinary annuity of 1 for four years of an implicit rate of 12% is 3.0373. The lease provides for a transfer of ownership of the equipment to the lessee at the end of the lease term. Compute for the depreciation expense for the right of use of asset for the year ended December 31, 2020.
Financial Statement Analysis and Preparation
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