Comilla Transport Ltd. Leased A Bus From Uttara Motors Ltd. On January 1, 2013, Under The Lease Agreement

My Ads

Comilla Transport Ltd. Leased a bus from Uttara Motors Ltd. on January 1, 2013, under the lease agreement. The cash price of the bus was Tk. 7,45,000, Tk. 2,00,000 was paid on delivery and the balance in three yearly installments, of the installments of Tk. 2,00,000 each. Interest was charged @ 5% on the outstanding balance.
Prepare a lease payment schedule.

To prepare the Lease Payment Schedule, we track the outstanding cash price, the interest calculated on the outstanding balance at 5% per annum, the principal reduction, and the final balance for each period.

Key Data & Breakdowns:

Cash Price of Bus: Tk. 7,45,000
Down Payment (Jan 1, 2013): Tk. 2,00,000
Beginning Outstanding Principal:
Annual Installment: Tk. 2,00,000 (includes Interest + Principal reduction)
Interest Rate: 5% per annum

Yearly Calculations:

Jan 1, 2013 (Down Payment):
- Outstanding Balance:
Dec 31, 2013 (1st Installment):
- Interest:
- Principal Repayment:
- Ending Balance:
Dec 31, 2014 (2nd Installment):
- Interest:
- Principal Repayment:
- Ending Balance:
Dec 31, 2015 (3rd / Final Installment):
- Principal Repayment: Full remaining balance =
- Interest (Balancing Figure):
- Ending Balance:

Lease Payment Schedule Table

Date	Total Payment (Tk.)	Beginning Balance (Tk.)	Interest @ 5% (Tk.)	Principal Paid (Tk.)	Ending Balance (Tk.)
01-01-2013	2,00,000	7,45,000	—	2,00,000	5,45,000
31-12-2013	2,00,000	5,45,000	27,250.00	1,72,750.00	3,72,250.00
31-12-2014	2,00,000	3,72,250	18,612.50	1,81,387.50	1,90,862.50
31-12-2015	2,00,000	1,90,862.50	9,137.50	1,90,862.50	0.00
Total	8,00,000	—	55,000.00	7,45,000.00	—