ABC company has taken an asset on a lease for 6 years from VSR company and submits the following details:

       Particulars                                                   Amount Rs

a) Lease term payment                                      10,000 p.m

b) Contingent Rent                                               1,00,000

c) Cost for services provided by VSR Company  75,000

d) Taxes to be reimbursed by VSR Company     25,000

e) Residual value guaranteed by ABC Company 5,000

f) Fair value of asset after 5 years                         30,000

Also, ABC company has an option to purchase the asset after a period of 6 years at Rs 15,000. 

Calculate minimum lease payments from the above information.

Answer rating: 100% (QA)

To calculate the minimum lease payments we need to consider the lease payments and the conting... View the full answer