CJ Company purchased a new building for P6,000,000 on January 1, 2019 for the purpose of...

 

Transcribed Image Text:

CJ Company purchased a new building for P6,000,000 on January 1, 2019 for the purpose of leasing it. The building has an estimated 10-year life. On April 1, 2019, CJ leased the building to a lessee for the three years at a monthly rental of P400,000. The lessee paid the rental for one year of P4,800,000 on April 1, 2019 and additionally paid P900,000 to CJ as a lease bonus to obtain the three-year lease. On April 1, 2019, CJ incurred initial direct cost P300,000. What is CJ's 2019 operating profit on this leased asset? CJ Company purchased a new building for P6,000,000 on January 1, 2019 for the purpose of leasing it. The building has an estimated 10-year life. On April 1, 2019, CJ leased the building to a lessee for the three years at a monthly rental of P400,000. The lessee paid the rental for one year of P4,800,000 on April 1, 2019 and additionally paid P900,000 to CJ as a lease bonus to obtain the three-year lease. On April 1, 2019, CJ incurred initial direct cost P300,000. What is CJ's 2019 operating profit on this leased asset?

Answer rating: 100% (QA)

Alcording to the data D CJ Company purchased a new buil... View the full answer