On 1july 2007, Kingsley entered an agreement to rent a warehouse for two years at a monthly rent of$4250 . The landlord allowed a grace period for the first twomonths. The agreement can be cancellable after one year.
How should I express the amount on balance sheet as at 30 June2008 and income statement for the year ended 30june 2008?
The ans said (4250*12-4250*10) and (4250*10) on b.s. and i.s. respectively but i dont understand.
Also, the ans said if the agreement was uncancellable, the amount on b.s. should be (4250*22/24)*12=$46750 and i cant understand
Plz help
