23. Which of the following is true regarding IFRS 16? * a. Lessors shall recognize assets held under a contract of lease as a receivable at an amount equal to the net investment in the lease. b. Lessors shall recognize assets held under a contract of lease as a O receivable at an amount equal to the cost of the asset which is the subject of the lease. c. Lessors shall recognize assets held under a finance lease as a receivable at an amount equal to the net investment in the lease. d. Lessors shall recognize assets held under a finance lease as a receivable at an amount equal to the cost of the asset which is the

23. Which of the following is true regarding IFRS 16? * a. Lessors shall recognize assets held under a contract of lease as a receivable at an amount equal to the net investment in the lease. b. Lessors shall recognize assets held under a contract of lease as a O receivable at an amount equal to the cost of the asset which is the subject of the lease. c. Lessors shall recognize assets held under a finance lease as a receivable at an amount equal to the net investment in the lease. d. Lessors shall recognize assets held under a finance lease as a receivable at an amount equal to the cost of the asset which is the

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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In accounting for an operating lease, how are the lessee’s and lessor’s income statements affected?
Explain the accounting involved in applying the operating lease method by a lessor.
D6) Describe the criteria that the lessee must utilize when determining whether a lease is to be treated as a finance lease or as an operating lease according to ASC 842. Original answer.
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The objective of IAS 17 Leases is to prescribe the appropriate accounting treatment and required disclosures in relation to leases. Which TWO of the following situations would normally lead to a lease being classified as a finance lease? (1) The lease transfers ownership of the asset to the lessee by the end of the lease term. (ii) The lease term is for approximately half of the economic life of the asset. (iii) The lease assets are of a specialised nature such that only the lessee can use them without major modifications being made. (iv) At the inception of the lease, the present value of the minimum lease payments is 60% of what the leased asset would cost to purchase. Select one: O a. (ii) and (iii) O b. (i) and (iii) c. (i) and (ii) O d. (iii) and (iv)
am. 104.
How should an entity account for a short-term or low-value lease under PFRS 16? Group of answer choices Recognize an discounted present value of future payments. On a straight-line basis unless the use of the asset allows for a more appropriate treatment. Recognize the expense as it is paid. The same treatment as long-term leases
Which of the following is classified under PAS 16 - -Investment Property -Property Sold under a Finance Lease Agreement -Machinery Held under a low value Lease Agreement -Property Leased under a Finance Lease Agreement
(48) If, as part of the accounting for a lease, the lessee debits an asset and credits a liability, then the lease must be a(n): A. Finance Lease B. Operating Lease C. Operating lease or finance lease D. none of the above
Leasing is often referred to as off-balance-sheet financing because of the way that the transaction is treated and reported in financial statements. According to the FASB-issued Statement 13, which of the following statements is true? The present value of all future lease payments should be reported as assets on the balance sheet. Leased assets should be reported as current assets on the balance sheet. The present value of all past lease payments should be reported as a liability on the balance sheet. Assets leased under financial or capital leases should be reported as fixed assets on the balance sheet. Consider the following statement on capital leases: According to Statement 13, the payments on a financial lease should be treated as an operating expense and should not in any case. affect a firm's true debt ratio. Is the preceding statement is true or false. True False
Question 45, A lessor has entered into a lease agreement that meets multiple of the criteria that require a lessee to classify the lease as a capital lease. The lease also meets the following criteria: (1) the collection of the minimum lease payments is reasonably assured, and (2) no important uncertainties exist about unreimbursable costs to be included as part of the lease. Which of the following would the lessor be unable to classify this lease as when accounting for it in the lessor's books and records? (A) Operating lease (B) Sales-type lease (c) Direct financing lease (D) Leveraged lease (E) None of the above Question 46. Which of the following is true about how a lessee may depreciate a capital lease under ASC 480? (A) They will depreciate the lease on a monthly basis and recognize depreciation expense with an offset to the accumulated depreclation the capital lease. (B) If the lease is classified as a capital lease because it contains a bargain purchase option, the lessee will…