KKK Company leased a piece of machinery costing P5,000,000 with an unguaranteed residual value of P400,000 to a lessee on January 1, 2022. The lease term is 5 years, and the implicit interest rate is 15%. The annual lease payment of P1,500,000 is due at the end of the year starting December 31, 2022. The machine reverts to the lessor at the end of the lease term. The lease is considered as manufacturer’s lease by the lessor. 

How much is the Gross Profit in 2022?

How much is the Interest Revenue in 2022?

How much is the Finance Lease Receivable (net of discount) at December 31, 2022?

Answer rating: 100% (QA)

SOLUTION To determine the Gross Profit Interest Revenue and Finance Lease Receivable net of discount at December 31 2022 we need to calculate and analyze the lease transactions for the year Given info... View the full answer