The haulier Kerval leases a logistics depot fitted with modular loading docks. On the commencement date itself, it pays a lease payment of 40,000 and receives from the lessor a contribution of 10,000 to its installation costs, qualifying as a lease incentive. The present value of the lease payments still due at that date is 512,400. Kerval bore 8,600 of initial direct costs and will have to dismantle the docks at the end of the lease; the estimate of that dismantling, determined under IAS 37, is 31,000 (given). What is the initial cost of the right-of-use asset?
- Present value of the lease payments still due (lease liability)
- 512,400
- Lease payment made at the commencement date
- 40,000
- Lease incentive received
- 10,000
- Initial direct costs
- 8,600
- Estimated dismantling costs (IAS 37)
- 31,000