In accounting for lease contracts, companies reporting under U.S. GAAP O are required to treat the cash payments as "rent expense" if the contract is for 24 months or less. do not need to capitalize the leased right-to-use asset if the contract is deemed immaterial. O have the discretion to classify the cash payments as "rent expense". O have to disclose every detail of the contract in the footnotes to the financial statements.
In accounting for lease contracts, companies reporting under U.S. GAAP O are required to treat the cash payments as "rent expense" if the contract is for 24 months or less. do not need to capitalize the leased right-to-use asset if the contract is deemed immaterial. O have the discretion to classify the cash payments as "rent expense". O have to disclose every detail of the contract in the footnotes to the financial statements.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![In accounting for lease contracts, companies reporting under U.S. GAAP
are required to treat the cash payments as "rent expense" if the contract is for 24 months or
less.
O do not need to capitalize the leased right-to-use asset if the contract is deemed immaterial.
O have the discretion to classify the cash payments as "rent expense".
O have to disclose every detail of the contract in the footnotes to the financial statements.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F0301c085-130c-469a-8732-8d67d5bd8057%2Fea9c90bb-a89b-4868-bd25-22dc95b86346%2F2lssq9_processed.png&w=3840&q=75)
Transcribed Image Text:In accounting for lease contracts, companies reporting under U.S. GAAP
are required to treat the cash payments as "rent expense" if the contract is for 24 months or
less.
O do not need to capitalize the leased right-to-use asset if the contract is deemed immaterial.
O have the discretion to classify the cash payments as "rent expense".
O have to disclose every detail of the contract in the footnotes to the financial statements.
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