Leaase Quiz ( 20 questions)

Ch19-1: Is leasing a zero sum game in the sense that any gain to the lessee is a cost to the lessor?  If not, how might both parties gain from a lease transaction? In your answer, explain how lessee and the lessor analyze the situation, why they might use different inputs in their analysis, and how those inputs differences could affect the outcome

Match the correct term to its definition

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Which of the following is incorrect regarding the accounting for leases by a lessee? A. A lessee recognizes the same total amount of expense on a lease whether it uses the general recognition or the recognition exemption under PFRS 16. B. The interest expense on a lease liability decreases each period C. According to PFRS 16, executory costs, such as insurance and real property taxes, are always excluded from lease payments regardless of whether these costs transfer goods or services to the leasee.  D. A lessee shall allocate the total consideration in a contract to the lease components and non-lease components of the contract

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Regarding a basic capital (finance) lease for a lessee, which of the following statements is INCORRECT? The lessee uses the lease as a source of funding. The lessee accounts for the lease as if an asset is purchased and a long-term obligation is entered into. The lessor uses the lease as a source of funding. The lessee records the leased asset at the lower of the minimum lease payments and the fair value of the asset at the lease's inception.

Assume a lessee leases equipment and insists on terms that qualify it as an operating lease, barely escaping the qualification as a capital lease. Discuss the impact that such an operating lease has on financial statements and related financial information as compared to the effect that a capital lease would have.

In the government-wide financial statements, the assets acquired under a capital lease would be reported at the total of all payments required under the lease. the present value of the required lease payments. the undiscounted total of required lease payments. they are not reported in the government-wide financial statements.

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x means incorrect answer not included in the choices.

17 How should a lease for a general capital asset be recorded in the governmental activities accounts at the inception of the lease? Multiple Choice Debit to a lease asset account. Debit to a capital expense/expenditure account. Credit to Lease Obligations Payable. Both Debit to a lease asset account and Credit to Lease Obligations Payable are correct.

In some states, a mortgage is considered to be a lien on real property. In other states, like Connecticut, a mortgage is a: a. temporary transfer of title b. bona fida purchase c. sales contract d. all of the above

For a(n) ________ lease, a lessor recognizes revenue on the sale and records the asset, ________ lease. It also removes the leased asset from its accounts and records the ________. Group of answer choices sales-type; net investment in lease–sales-type; cost of goods sold finance; gross investment in lease–sales-type; cost of goods sold operating; net investment in lease–sales-type; cost of goods sold sales-type; finance; revenue

In respect to Loss Conditions in the Commercial Property Coverage Forms, after a loss has been paid, if the property is recovered. What option does the Named Insured have? O a. Named Insured has an option to take the property and return the loss payment. b. No options, the loss has been paid. c. The Insurance company can keep the property if the Named Insured does not want it. d. The Named Insured can take the property back and not pay back the loss payment.

t19

Explain the ways in which property owners can structure leases in order to recover operating expenses?

Why should investors be concerned about market rents if they are purchasing a property subject to leases?

Step by step solutions

What are some lease provisions that would cause a lease to beclassified as a non-tax-oriented lease?