Memorandum To: Supervisor From: Date: March 14, 2011 Re: Leases and Lease Issues CONFIDENTIAL The trucking company currently owns 100 trailers and a new client have requested 20 more for a total of 120 trailers for its project. The relationship with the new client is uncertain but at the same time it has potential for significant growth of the company. The uncertainty of the relationship may have an effect on the financial position of the client company
supervisor has asked a research to be conducted on leases and lease structure issues on the Financial Accounting Standards Board (FASB) website, in particular the current practice and thought related to direct financing, sales type, and operating leases. This paper is a memo addressed to the supervisor that summarizes the FASB research results. It recommends an approach that the client can use to evaluate and capitalize on this opportunity. MEMO Date: MM/DD/YY To: Team Supervisor From:
purchases of leases. The joint effort of the two has finally come to an end, with the new standards being issued out on February 25, 2016. These new standards will come into effect starting in 2019. It is important that our diversified company begins preparing for the major implications of these new standards and fully understand what we are dealing with. The Accounting Standards Update No. 2016-02, Leases (Topic 842) will have an immediate effect on our company because is involved in many lease-related
Finance BNRR Date: July 15, 1990 Subject: Lease Vs Buy Option for Auto Racks Equipment This memo is in regard to the recent proposal of leasing or buying the bi-level and tri-level Auto Rack equipment for Burlington Northern Railroad Company. As indicated before, this equipment is a great investment for our company as it exceeds our company’s 20% hurdle rate and therefore investing in them would be a great decision for the company. Hence this memo will seek to explain the optimal way to finance
1. Law and the Impact on Business Leases You are a skateboard designer and decide to open a shop. You find a “perfect space” in a local mall and agree to sign a one-year lease agreement that runs from January 1 through December 31. The lease agreement specifies that the lease cannot be assigned without the mall’s consent. In late June, you decide that this space is not attracting enough customers, so you decide to assign the balance of your lease to Jennifer Beeswax, who owns a candle shop
MEMO Date: July 18, 2011 3 Subject: Leases and Lease Structure Issues 4 To: Regional Trucking Company 5 From: Bob Stanton This memo will cover the current practice and thought related to direct financing, sales type, and operating leases. I understad that Regional Trucking Company have limited time to cover all aspects of these areas. Disclosure Requirements for Capital Leases SFAS No. 13 also requires the disclosure of additional information for capital leases. The following
million people. The property offers 24’ clearance height, 40’ x 40’ column spacing, 24 loading/truck doors, and 220 parking spaces. The property is currently fully leased to three credit tenants, all of which have expressed an interest in renewing their leases as soon as they expire. Investment Strategy This opportunity represents a Value-Add Investment strategy, a slightly lower return profile than people I would normally look for while investing in distressed assets may be looking for. This return profile
into a ten-year operating lease for office space in accordance with ASC 840, Leases. It has neither renewal option nor the ability to negotiate for renewal per lease agreement. Within the leased premise, NeedsLease has placed into service various leasehold improvements that have economic useful lives of 12 years. In the lease agreement, there are certain provisions that may require the lessee to perform certain activities and to incur certain costs at the end of the lease term. Such provisions
terminate the lease of its present facility, incurring an early termination fee in addition to its normal rental payments through the date of termination. The terms of the lease are such that Lay’m-Off accounts for the lease as an operating lease. Further, the lease agreement stipulates that written notice in the form of a letter or e-mail from Lay’m-Off directly to the lessor is required for early termination. Issue 1. How should Lay’m-Off account for the restructuring costs of lease termination costs
Pharma Company has taken several actions which are listed below: On December 15, 2011, Pharma Company issued a press release announcing its intentions to terminate its operating lease in the Bellvue location. Per the lease agreement, written notice is required for early termination. According to the issued memo, the lease termination fee is $1.3 million and Pharma will vacate the property (and sign the termination agreement) on January 31, 2012. On December 27, 2011, Pharma Company management relayed