In a financing lease, “front loading” of lease expense and lease revenue occurs. What does this mean, and how is it avoided in an operating lease?

Q: Which of the following does not affect the computation of the rental income/expense under an…

A: Security deposits does not affect the computation of the rental income/expense under an operating…

Q: Describe the accounting procedures that must be followed by a lessee when employing the operational…

A: The Question is about the accounting procedures that must be followed by a lessee when employing the…

Q: What is the theoretical basis for the accounting standard that requires certain long-term leases to…

A: Lease: Lease is a contractual agreement whereby the right to use an asset for a particular period of…

Q: Explain when and how a lessee accounts for a lease by the shortcut method.

A: The shortcut method is when the lessee and the lessor don't account for the lease at its…

Q: When can a lease create both an asset and a liability for the lessee?

A: Lease is an agreement between two persons in which one grants the right to another to use a…

Q: What are the two subsequent measurement for financial asset? Who are part of the contract of lease

A: The financial assets is the kind of liquid assets that gets its value from the right of the contract…

Q: From a lessee perspective, distinguish between a finance lease and an operating lease.

A: Lessees have available two lease accounting methods: (a) the operating method and (b) the…

Q: Which of the following is not correct statement for accounting by the lessee? O a. The lessee…

A: The incorrect Statement for accounting by lessee is "The operating lease method is used to account…

Q: The term of a finance lease includes the initial lease term and any bargain renewal terms.    True…

A: The answer for the True or false question is discussed hereunder : What is a finance lease?  Finance…

Q: The following are some of the characteristics of an asset available for lease. (Click the icon to…

A: Leasing an asset involves financial considerations for both the lessor (the owner of the asset) and…

Q: Describe the accounting for leases by lessors.

A: There are mainly 2 types of lease:   1. Finance and 2. Operating    Finance lease is a lease where…

Q: lassified as a finance lease or as an operating lease.

A: In case of a financial lease only, assets or liabilities are created. In case of operating lease…

Q: Which of the following items would not be included in the calculation of the lease liability for a…

A: Finance lease is the lease where lessee has operation control as well as share of economic risk and…

Q: Explain the distinction between a direct-financing leaseand a sales-type lease for a lessor.

A:

Q: At the beginning of a Type B lease, the lessee will record what asset and liability, if any?

A: Type B lease implies to the lease in which insignificant portion of the useful life of the asset is…

Q: Need help with this question

A: Step 1:A lease is a contract in which  the lessee has to pay  purchase consideration to the lessor…

Q: In accounting for a finance lease/ Sale-type lease, how are the lessee's and lessor's income…

A: The income statements of the lessor and lessee are affected in finance leases and sale-type leases.…

Q: Provide correct answer for this question

A: Step 1: Definition of LeaseA lease can be explained as a contract between two parties in which one…

Q: The basic concept of “substance over form” influence lease accounting. Explain in detail how it does…

A: Substance over form is an accounting concept that business transactions should be accounted in…

Q: IFRS (a) What is included in the measurement of (1) the lease liability and (2) the right-ofuse…

A: International financial reporting standard (IFRS) 16 is the standard for accounting for Lease. This…

Q: When are initial direct costs recognized in an operating lease? In a direct financing lease? In a…

A:

Q: A lease that involves a manufacturer’s or dealer’s profit is a(an):(a) direct financing lease.(b)…

A: Lease: Lease is a contractual agreement whereby the right to use an asset for a particular period of…

Q: In accounting for an operating lease, how are the lessee’s and lessor’s income statements affected?

A: Lease:   Lease is a contractual agreement whereby the right to use an asset for a particular period…

Q: (4) In a lease that is appropriately recorded as a direct-financing lease by the lessor, unearned…

A: A lease can be referred to as an agreement in which one party, lessor, grants the right to use an…

Q: Explain the accounting involved in applying the operating lease method by a lessor.

A: Operational lease method: A process of using the asset for a rental payable in instalments or in…

Q: Which statement characterizes an operating lease? The lessor records depreciation and lease…

A: Solution: Following statement characterizes finance lease: The lessee records depreciation and…

Q: How do the lessee and lessor will agree to modify the terms of a lease before the lease term ends?

A: Lease Agreement:   It is a contract between the owner of an asset (lessor) and a tenant (lessee) for…

Q: Which of the following are normal characteristics of a financial lease? I. Maintenance of the leased…

A: In a financial lease an entity (lesser) borrows an asset for a considerably long period of time…

Q: When a lessee makes periodic cash payments for a finance lease, which of the following accounts is…

A: A lease is a contractual arrangement, whereby one party  (i.e., owner of the asset - Lessor ) grants…

Q: A lessee should classify a lease transaction as a finance lease if it is noncancelable and one or…

A: A capital lease, also known as a finance lease, is an agreement between the lessor and the lessee…

Q: n an operating lease, the lessee records interest expense. lease expense. amortization expense and…

A: Lease is one type of source of finance, where there are two parties Lessee and lessor. The person…

Q: The methods of accounting for a lease by the lessor are Select one: a. operating and finance lease…

A: A lease is an arrangement under which a lessor agrees to allow a lessee to control the use of…

Q: Explain the differences in revenue recognition for the lessor in a sales-type lease, a direct…

A: (a) Sale-type lease: Under this, revenue is recognized at the beginning of the lease. If the…

Q: A lease liability is measured at the fair value of the underlying asset. Question: True or False

A: Lease Liabilities are measured on discounted basis where a financial obligation arises for payment…

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.