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IFRS 16 LEASING

Total questions: 10

Worksheet time: 12mins

Name
Class
Date
1.

In which year the old IAS 17 was replaced by IFRS 16?

a)

2010

b)

2018

c)

2016

d)

2020

2.

Messi plc entered into an agreement for 5 years with Ronaldo plc related to renting a piece of machinery going to be used by Ronaldo plc. Messi will collect annual rental in arrear. Identify the lessor and lessee.

a)

Lessor: Messi Lessee: Ronaldo

b)

Lessee: Messi Lessor: Ronaldo

3.

Based on IFRS 16 entities will be given exemption from applying IFRS 16 for short term lease (<12 months) and for low value assets.

a)

False

b)

True

4.

Entity A had entered into a lease agreement with Entity B for 3 years. Entity A will supply a special machine to Entity B. Entity B will pay a initial deposit of $20,000 and installment in arrear of $30,000 for 3 years. Imputed interest rate is 5% per anum. Compute the NPV of MLP.

a)

$101,696

b)

$120,000

c)

$20,000

d)

$102,456

5.

Entity A had entered into a lease agreement with Entity B for 4 years. Entity A will supply a special machine to Entity B. Entity B will pay a initial deposit of $10,000 and installment in arrear of $50,000 for 4 years. Imputed interest rate is 8% per anum. Compute the NPV of MLP.

a)

$175,620

b)

$124,567

c)

$175,605

d)

$135,678

6.

Entity A had entered into a lease agreement with Entity B for 3 years. Entity A will supply a special machine to Entity B. Entity B will pay a initial deposit of $20,000 and installment in arrear of $30,000 for 3 years. Imputed interest rate is 5% per anum. Compute the total lease interest.

a)

$8,403

b)

$8,304

c)

$8,503

d)

$8,533

7.

Entity A had entered into a lease agreement with Entity B for 3 years. Entity A will supply a special machine to Entity B. Entity B will pay installment in advance of $30,000 for 3 years. Imputed interest rate is 6% per anum. Compute the NPV of MLP.

a)

$85,000

b)

$85,004

c)

$85,002

d)

$85,009

8.

Entity A had entered into a lease agreement with Entity B for 3 years. Entity A will supply a special machine to Entity B. Entity B will pay installment in advance of $80,000 for 5 years. Imputed interest rate is 8% per anum. Compute the NPV of MLP.

a)

$344,986

b)

$344,965

c)

$344,123

d)

$344,968

9.

The following are the possible methods to allocate finance lease interest in lessee books except

a)

Actuarial method

b)

SODM

c)

SLM

d)

UUM

10.

In the lessee books, ROU asset and finance lease liabilities will be recognized as per IAS 17.

a)

True

b)

False