Indian Leasing by Vinod Kothari
Examples on Calculation of Capital Recovery and Lease equalisation
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CASE 1: RENTALS IN ARREARS : RENTALS PAYABLE ANNUALLY |
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ASSET COST |
1000 |
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RENT |
364 |
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YEARS IN LEASE |
5 |
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ACCOUNTING IRR |
24.00% |
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FINANCIAL IRR |
24.49% |
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LMF |
1.00% |
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DEPRECIATION RATE |
11.00% |
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RESIDUAL VALUE |
0.00% |
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YEAR |
LEASE |
INV.O/S |
FIN CRG. |
CAP. REC. |
DEPRN. |
LEA |
LTA |
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RENT |
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24.00% |
-1000 |
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1 |
364 |
1000 |
240 |
124 |
110 |
14 |
14 |
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2 |
364 |
876 |
210 |
154 |
110 |
44 |
58 |
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3 |
364 |
722 |
173 |
191 |
110 |
81 |
139 |
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4 |
364 |
531 |
127 |
237 |
110 |
127 |
266 |
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5 |
364 |
294 |
70 |
294 |
110 |
184 |
450 |
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---------- |
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1000 |
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PROFIT AND LOSS A/C |
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DEBITS |
YEAR 1 |
CREDITS |
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DEPRN. |
110 |
LEASE RENT |
364 |
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NET CREDIT |
240 |
LESS: LEA |
14 |
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----------- |
-------- |
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350 |
350 |
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YEAR-WISE VIEW OF P & L ACCOUNT |
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YEAR |
CREDITS |
REDN. |
DEBITS |
NET |
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LEASE |
LEA |
DEPRN. |
CREDIT |
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RENT |
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1 |
364 |
14 |
110 |
240 |
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2 |
364 |
44 |
110 |
210 |
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3 |
364 |
81 |
110 |
173 |
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4 |
364 |
127 |
110 |
127 |
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5 |
364 |
184 |
110 |
70 |
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BALANCE SHEET |
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ASSETS |
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FIXED ASSET |
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COST |
1000 |
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LESS: DEPRN. |
110 |
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LESS: LTA |
14 |
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----------- |
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|
876 |
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YEAR -WISE VIEW OF BALANCE SHEET |
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YEAR |
FIXED |
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ASSET |
NET |
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COST |
DEPRN. |
LTA |
VALUE |
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1 |
1000 |
110 |
14 |
876 |
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2 |
1000 |
220 |
58 |
722 |
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3 |
1000 |
330 |
139 |
531 |
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4 |
1000 |
440 |
266 |
294 |
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5 |
1000 |
550 |
450 |
0 |
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