CERTYNEX IFRS ACADEMY

For 20X1, the accountant of Calderis recorded three entries on a lease (opening lease liability 220,000, rate 5%, lease payment of 52,000 paid on 31 December): (1) depreciation of the right-of-use asset of 40,000; (2) debit interest expense, credit lease liability 11,000; (3) debit lease expense, credit cash 52,000. Which entry is wrong?

Entry (1): a right-of-use asset is not depreciated.

Entry (2): interest should be computed on the balance after payment.

Entry (3): the payment made must be debited to the lease liability.

None: all three entries are correct.