Reference no: EM132653285

On January 1, 20x1, lessor leased an office space to lessee. Payments on the lease will be made as follows:

Year                               Rental Payment

Dec. 31, 20x1               200,000

Dec. 31, 20x2              240,000

Dec. 31, 20x3              260,000

total:                           700,000

• as an inducement to enter to the lease, lessor granted lessee the first six months of the lease as a rent free.
• Additional rent (contingent rent) of 10% is to be paid for any excess of sales of lessee over P2,000,000. Lessee's sales for 20x1, 20x2, and 20x3 are P1,800,000, P2,000,000 and P3,000,000 respectively.

Requirements:

Problem 1: provide all journal entries in the books of Lessor.