TASK

Company X will enter into an operating lease arrangement on 1 January 2021 for its offices. The lease term will be 3 years. The arrangement requires company to make no payment in year one and 300,000$ in year tow and three.

What are the typical double entries for the company X in order to account for this arrangement as at:

a.31 December 2021

b.31 December 2022

c.31 December 2023

On December 2019 Company X prepaid 30,000$ for a 2-year insurance policy for the period 1 January 2020 to 31 December 2021

What are the typical double entries for the company X in order to account for this arrangement as at:

a.31 December 2019

b.31 December 2020

c.31 December 2021