Question

A firm enters into a 3-year lease for equipment: present value of lease payments at commencement = ₹9,00,000. Useful life of equipment = 5 years. Lessee recognises ROU asset of ₹9,00,000 and lease liability ₹9,00,000. If straight-line depreciation is used over lease term (3 years), annual depreciation = ?

A ₹3,00,000
B ₹3,50,000
C ₹2,25,000
D ₹3,00,001
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