BLM15610 - Lease accounting: finance lease accounting: finance lessees: example 2: apportioning the rentals

This manual is being updated to reflect FRS 102 (2024 amendments). For guidance on the tax treatment of accounts prepared under IFRS 16 or the revised FRS 102, please refer to pages within the BLM50000 chapter.

As with the lease in Example 1 (see BLM15505), the process for apportioning the rentals between the income and capital elements is:

 

Lease rentals (£1,000 x 3 years)

£ 3,000

Lease rentals (£34,000 x 2 years)

£68,000

Lease rentals (total)

£71,000

Amount capitalised

£50,000

Finance charges

£21,000