On 1 January 2024, a company entered into a three-year lease for the use of office printers. The lease contract requires an advance payment of N$400 on 1 January 2024 and three annual instalments of N$600 in arrear on 31 December 2024, 2025 and 2026.
The lease qualifies for the low-value lease exemption.
For the year ended 31 December 2024, the financial statements of the lessee will report the following:
(Choose one correct option only)

Question

On 1 January 2024, a company entered into a three-year lease for the use of office printers. The lease contract requires an advance payment of N$400 on 1 January 2024 and three annual instalments of N$600 in arrear on 31 December 2024, 2025 and 2026.

The lease qualifies for the low-value lease exemption.

For the year ended 31 December 2024, the financial statements of the lessee will report the following:

(Choose one correct option only)

Answer

Lease expense of N$733 and a lease accrual of N$267

Answer

Lease expense of N$600 and a lease accrual of N$400

Answer

Lease expense of N$733 and a lease prepaid of N$267

Answer

Lease expense of N$600 and a lease prepaid of N$400

Answer

Lease expense of N$1 000 and no lease prepaid or lease accrued

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On 1 January 2024, a company entered into a three-year lease for the use of offi...

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