looking for help in lease

[zia ahmad]

Dear all,
How would you deal this question?

XYZ LTD a leasing company.Engaged in leasing of equipments.Company maintains
the reasonable stock of such equipment that sometime not avilable in the market.
Company keeps such equipment as its own.During the year ended Dec 31,2009 Company enter into following two contracts.

SALE TYPE LEASE
Equipment costing Rs.250,000 purchased by it two months back was leased
to MB Limited on june 30,2009.
Fair value of equipment is Rs.300,000. Lease term is for three years and rental is due
in advance,the first rental of 120000 is received on june 30,2009.The leasing co has
also incurred Rs.10000 on commision to sales persons.

FINANCE TYPE LEASE
KD Limited puchase the equipment having fair value of Rs.500000.
and leasing company paid the amoount on the behalf of KD limited on
sept 2009.The rental will due in arrear, but leasing co receive advance of
100000.The term is five years and annual rental is 134000.
The commission of 20000 paid to sales person by leasing company.

Interest rate of leasing co for SALE TYPE LEASE in normally 21.5%
and for FINANCE TYPE LEASE is 20%. Market interest rate for
SALE TYPE LEASE IS 20%.

PREPARE EXTRACT OF FINANCIAL STATMENTS OF BOTH CONTRACTS.

Regard's