Q: Of what significance is (a) an unguaranteed and (b) a guaranteed residual value in the lessor's…
A: The amount to be recovered by the lessor is the same whether the residual value is guaranteed or…
Q: In a sale-leaseback transaction the owner of an asset sells it and immediately leases it back from…
A: Sale-Leaseback approach: In the sale-leaseback approach, the owner of the leased asset sells it and…
Q: Briefly describe the conceptual basis for asset and liability recognition under the right-of-use…
A: lessee is the tenant or the person who holds the property or asset under lease. Right of use means…
Q: Describe the effect of a “bargain-purchase option” onaccounting for a capital lease transaction by a…
A:
Q: The amount of gain (loss) on sale and leaseback transaction is: Group of answer choices The…
A: Sales and lease back transaction refers to the transaction where an asset is sold by the seller to a…
Q: What entry is made when selling a fixed asset?
A: Following entry is passed when selling the fixed assets:
Q: If the residual value of a leased asset is guaranteed by a third party:
A: A lease is an arrangement under which a lessor agrees to allow a lessee to control the use of…
Q: What is the concept of sale-leaseback agreement?
A:
Q: Which of the following has the right to sell an asset at a predetermined price?
A: A put option is an instrument which provides its holder an option to sell an underlying asset on a…
Q: If the fair value of net assets is less than the offered price the acquisition considered as a…
A: Fair value of the assets is the amount which can be fetched by entering into sales transaction…
Q: Explain how purchase commitments are recorded for the lower of contract price or market price.
A:
Q: What situations cause us to remeasure a lease liability and right-of-use asset How is that…
A: Lease: Lease is a contractual agreement whereby the right to use an asset for a particular period of…
Q: lessee
A: Lease is a financial arrangement where the right to use the asset is given by the owner to another…
Q: Describe the effect on the lessee of a “bargain purchase option” on accounting for a finance lease…
A: Lease agreement refers to an agreement in which a contract is made to get the asset on lease. The…
Q: xplicitly identified in the contract, it means that: a. the identified asset is never mentioned in…
A: When the asset is implicitly identified, this means asset is implied but is not directly expressed.…
Q: This is an arrangement in which one party sells a property to a buyer and the buyer immediately…
A: solution: Sale and leaseback is an arrangement in which one party sells a property to a buyer and…
Q: Understand how variable consideration and other aspects of contracts affect the calculation and…
A: Variable consideration: It refers to the amount of revenue that is to be recognized as per the…
Q: If the fair value of the consideration for the sale of an asset does not equal the fair value of the…
A: If the fair value of the consideration for the sale of an asset does not equal the fair value of the…
Q: Which of the following statements are false under a sale a leaseback transaction? I. If a sale and…
A: In the given case Option II only is the incorrect and False Statement.... If the sale price is…
Q: Generally accepted accounting principles require that certain lease agreements be accounted for as…
A: Generally accepted accounting principles require that certain lease agreements be accounted for as…
Q: right of use asset and a lease liability on the part of the lessee?
A: Lease -: A Lease is an agreement summarizing the conditions in which one party decides to rent…
Q: The gain/loss related to a sale and leaseback transaction not recognized by the seller-lessee in its…
A: Rights retained .. The gain or the loss relating to a sale and leaseback transaction not recognized…
Q: What are the types of agreement related to sale-leaseback agreement?
A: Sale and Leaseback Agreement is a kind of financial transaction. This is a situation that arises…
Q: A(n) is a contract for the use of an asset for a period of time without having to buy the asset. Oa.…
A: lease: lease is a contract to buy the right to use the asset for particular period of time on…
Q: his type of lease involves recognition of a manufacturer’s or dealer’s profit or loss on the…
A: Step 1 In a sales-type lease, the lesser is assumed to be selling a product to the lessee, which…
Q: Is variable consideration included in the calculation of a contract’s transaction price? If so, how…
A:
Q: Which of the following statements is true about initial direct costs? A. Initial direct costs of a…
A: According to the Generally Accepted Accounting Principle, initial direct cost is defined as the…
Q: For a call option, the: * A. buyer is locked into receive the underlying asset at a specified…
A: Call option is a type of contract in which buyer has right or option to purchase specified asset or…
Q: The major difference between future and option arises from the different obligations of buyers and…
A: The option and future are used to hedge investment as well as to make money and it represents the…
Q: How does a seller allocate a transaction price to a contract’s performance obligations?
A: Transaction price: Transaction price is the amount of consideration that is estimated by the company…
Q: seller agrees or obliges
A: TRUE defines a contract of sale as a contract whereby one in all the catching parties obligates…
Q: How does the analysis of a sale-leaseback differ from the analysis of owning versus leasing?
A: A sale lease back is very beneficial for the company because it helps the company to sell the asset…
Q: right of use asset
A: Correct Answer :- C Sale price
Q: The amount of gain (loss) on sale and leaseback transaction is: A. The difference of fair value and…
A: Gain is booked when money is received on the sale of the asset. leasing back can be assumed to be…
Q: This is a legal maxim most likely similar to a sale and leaseback transaction. traditio brevi manu…
A: Option Traditio Constitutum possessorium is correct.... It is a delivery that takes place when the…
Q: The buyer-lessor recognizes the asset from a sale and leaseback transaction resulting to a finance…
A: The buyer-lessor recognizes the asset from a sale and leaseback transaction resulting to a finance…
Q: Describe the lessee's accounting for sale-leaseback transactions.
A: Meaning:
Q: Compare the way a purchase option that is reasonably certain to be exercised and a lessee-guaranteed…
A: Definition: Lease: Lease is a contractual agreement whereby the right to use an asset for a…
Q: Describe and demonstrate how the lessor accounts for a sales-type lease with a selling profit.
A: In a sales-type lease, the lessor is assumed to actually be selling a product to the lessee, which…
Q: Occasionally, a lease agreement includes a guarantee by the lessee that the lessor will recover a…
A:
Q: When a sale-leaseback transaction occurs, if the leaseback is considered to be an operating lease,…
A:
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…
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- What is the effect of loss of the thing or object in a contract of sale?If the fair value of net assets is less than the offered price the acquisition considered as a bargain. True FalseWhen does a buyer-lessor recognize a financial asset from a sale and leaseback transaction? Fair Value > Carrying Amount Fair Value < Carrying Amount Sale Price > Fair Value Sale Price < Fair Value
- True or false 1. In a contract to sell what the seller agrees or obliges himself to do is to fulfill his promise to sell the subject property when the entire amount of the purchase price is delivered to him.What is an option? OA) A contract that is derived from some other underlying quantity, index, asset or event. B) A contract that gives the holder the right to buy or sell something at a specified price. C) A contract that gives the holder the right to sell an instrument at a pre- specified price. D) A contract that gives the holder the right to acquire an instrument at a pre- specified price.One of the following statements is false: a. If the underlying asset will not revert to the lessor, the residual value is simply ignored by the lessor in the computation of unearned interest income and gross profit on the sale. b. The underlying asset will remain with the lessee if the lease provides for either a purchase option that is reasonably to be exercised or transfer of title to the lessee upon the lease expiration. c. When a lessor actually sells an asset that it has been leasing, the difference between the sales price and the carrying amount of the lease receivable is recognized in profit or loss. d. The gain or loss that pertains to the right retained by the seller-lessee in a sales and leaseback transaction is not recognized.
- Which of the following is not included in the evaluation questions of IFRS 16 in identifying a lease contract? a. Does the lessee have the right to obtain all of the economic benefits from the use of the asset? b. Does the lessee direct the use of the identified asset throughout the period of use? c. Does the lessor have a substitution right over the asset? d. Is there an identified asset?Statement I: In case of doubt, a contract purporting to be a sale with right of repurchase is construed as an assignment of rights. Statement II: The creditors of the vendor cannot make use of the right of redemption against the vendee until after exhausting the property of the vendor. Only Statement I is true. Only Statement II is true. Both statements are true. Both statements are false.Of what significance is (a) an unguaranteed and (b) a guaranteed residual value in the lessor's accounting for a sales-type lease transaction?
- The seller of an option contract has the to buy or sell the underlying asset while the buyer of an option contract has the to buy or sell the underlying asset. O O O A right; obligation B с D obligation; right right; right obligation; obligationWhen the asset is explicitly identified in the contract, it means that: a. the identified asset is never mentioned in the contract b. there is no identified asset for lease c. the identified asset is clearly written in the contract d. the identified asset is not written in the contracUnless otherwise stated in the security agreement, if a debtor sells, exchanges or disposes of the collateral subject to a security agreement, the secured party_____have the right to receive the proceeds of the sale. Group of answer choices does not does