Question: a) Explain how the lease liability and a right-of-use asset would be recognised and measured at the lease inception? Explain the typical expenses recognised by

a) Explain how the lease liability and a right-of-use asset would be recognised and measured at the lease inception? Explain the typical expenses recognised by a lease during lease period.

b)Discuss (Using Australian accounting standard) If a decision is made to abandon an area of interest, how should any pre-production costs in respect of that area be treated? Explain, what costs should be included in the cost of inventory of an entity involved in the extractive industries.

c)Explain the 'qualifying asset' and how do we treat exchange rate differences relating to the acquisition of qualifying assets? Compare and contrast this with the treatment for assets that are not qualifying assets?

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