1.25 The table below represents the repayment schedule for Hercules Ltd. who has entered into a finance lease and uses a straight line amortization rate. Beginning Balance Reduction of Principal 16380 Closing Balance Interest 100000 10000 83620 Month Ending 30.6.2010 30.6.2011 30.6.2012 30.6.2013 Payment 26380 26380 26380 83620 65602 8362 6560 18018 19820 65602 45782 23980 45782 26380 4578 21802 30.6.2014 23980 26380 2400* 23980 0 Which is the correct answer? a. The annual payment of the lease was $26,380 and the interest rate charged was 8% pa. b. At the end of the first year the value of the asset in the balance sheet was the same for assets and liabilities. c. The current portion of the liability for the year ended 30 June 2011 was $18,018. d. The lease had an amortisation of $20,000 pa; with an interest rate of 10%; and was recorded at $100,000 for both assets and liabilities at the 30 June 2010