3. Which of the following is true in regards to the reassessment of the lease term? A. If the lessee reassesses the lease term, it must remeasure the lease liability as the present value of the remaining payments. B. If the lessee reassesses the lease term, the discount rate for the new term must be the interest rate used at the beginning of the lease. C. The lessee is not permitted to reassess its initial determination of the lease term or discount rate. D. The lesser Canary assess its initial determination of the lease term if there is a triggering event.

3. Which of the following is true in regards to the reassessment of the lease term? A. If the lessee reassesses the lease term, it must remeasure the lease liability as the present value of the remaining payments. B. If the lessee reassesses the lease term, the discount rate for the new term must be the interest rate used at the beginning of the lease. C. The lessee is not permitted to reassess its initial determination of the lease term or discount rate. D. The lesser Canary assess its initial determination of the lease term if there is a triggering event.

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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Concept explainers

Leasing

Leasing is a contractual arrangement in which someone (a lessee) pays the owner (or lessor) of a building, land, vehicle, or other asset for the use of that asset. The lease is the agreement between lessee and lessor.

Question

3. Which of the following is true in regards to the reassessment of the lease term?
A. If the lessee reassesses the lease term, it must remeasure the lease liability as the present
value of the remaining payments.
B. If the lessee reassesses the lease term, the discount rate for the new term must be the
interest rate used at the beginning of the lease.
C. The lessee is not permitted to reassess its initial determination of the lease term or discount
rate.
D. The lesser Canary assess its initial determination of the lease term if there is a triggering
event.

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