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Question 6 Soduko LTD Solution

Suduko Ltd's financial statements for the year ended 31 December 2022 include details on leases for two 3D laser cutting machines, with a right-of-use asset carrying amount of R308,750 after depreciation. The lease liability has a closing balance of R335,873, with future lease payments totaling R444,429 and total cash outflows related to leases amounting to R168,143. The company will own the machines at the end of the three-year lease period, with quarterly payments of R49,381.

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18 views1 page

Question 6 Soduko LTD Solution

Suduko Ltd's financial statements for the year ended 31 December 2022 include details on leases for two 3D laser cutting machines, with a right-of-use asset carrying amount of R308,750 after depreciation. The lease liability has a closing balance of R335,873, with future lease payments totaling R444,429 and total cash outflows related to leases amounting to R168,143. The company will own the machines at the end of the three-year lease period, with quarterly payments of R49,381.

Uploaded by

Kelaiah
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as XLSX, PDF, TXT or read online on Scribd
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FIAC7311 Previous Assessment Questions 2023: Sudoku Ltd

Lease note in the financial statements of Suduko Ltd for the financial year ended 31 December 2022
SUDUKO LIMITED
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022

Leases
1.1 Right-of-use asset Machinery
R
Carrying amount beginning of year -
Additions ((414 000 x 100/115) + 20 000) 380,000
Depreciation (380 000 / 4 x 9/12) (71,250)
Carrying amount end of year 308,750

1.2 Lease liability


Opening balance -
New lease contracts 414,000
Capital repayments (78,127)
Payments (3 x R49 381) (148,143)
Finance costs Amort P1 = 1, P2 = 3, Interest 70,016
Closing balance 335,873
Long-term presented under non-current liabilities balancing 208,010
Short-term presented under current liabilities Amort P1 = 4, P2 = 7, Interest 127,863

On 1 April 2022. Suduko Ltd entered into a three-year lease contract for two 3D laser cutting machines. The instalments of R49 381 are payable quarterly in arrears. The interest
rate implicit in the lease is 6% per quarter. Suduko Ltd will obtain ownership of the machines at the end of the lease period at no additional cost.

Calculations
Interest rate implicit in lease
PMT = R49 381
N = 12
PV = (414 000)
Comp I = 6% (accuracy)

1.3 Maturity analysis of future lease payments outstanding at the reporting date R
Future lease payments (undiscounted)
For the year ended 31 December 2023 (49 381 x 4) 197,524
For the year ended 31 December 2024 (49 381 x 4) 197,524
For the year ended 31 December 2025 (49 381 x 1) 49,381
Total future lease payments 444,429
Total future finance costs (balancing) 108,556
Lease liability (calculated above) 335,873

1.4 Total cash outflows relating to leases R


Presented under financing activities 78,127
Cash payments for principal portion of lease liabilities 78,127
Presented under operating activities 90,016
Cash payment for legal fees 20,000
Cash payments for interest portion of lease liability 70,016
Total cash outflow relating to leases 168,143

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