All of the following would normally lead to a finance lease, except
Chapter1: Financial Statements And Business Decisions
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All of the following would normally lead to a finance lease, except
The lease transfer ownership of the asset to the lease at the end of the lease term.
The present value of the minimum lease payments amounts to at least substantially all of the fair value of the asset at the inception of the lease.
The lease term is for a major part of economic life of the asset even if the title is not transferred.
The lessee has the option to purchase the asset at the price that is expected to be approximately equal to the fair value at exercise date.
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