QUESTION NUMBER 2: (Answer 2a up to 2e ) The University of Kabwe (UNKA) entered into a five year lease of a building which has a remaining useful life of ten years. Lease payments are ZMK 50,000 per annum, payable at the beginning of each year. UNKA incurs initial direct costs of ZMK 20,000 and receives lease incentives of ZMK 5,000. There is no transfer of the asset at the end of the lease and no purchase option. The interest rate implicit in the lease is not immediately determined but the lessee's incremental borrowing rate is 5%. At the commencement date UNKA pays the initial ZMK 50,000, incurs the direct costs and receives the lease incentives. With the above, you are required to; (2a) Discuss why you think UNKA right of use asset is indeed an asset which should be reported in its Statement of financial position. (4 marks). (2b) Calculate the lease liability and the right - of - use asset of UNKA (4 marks) (2c) Explain why you would not agree with the exemption from the recognition criteria for leases in the records of the lessee (2 marks). (2d) Explain why the International Accounting Standards Board (IASB) exempted short term leases and low value leases from the accounting treatments proposed by IFRS 16. (6 marks) (2e) Discuss why you think UNKA should embrace Off Balance Sheet Finance transactions generally that include lease transactions. (4 marks)