1. Gross investment in the lease is equal to Present value of lease payments under a finance lease of the lessor and any unguaranteed residual value. Sum of the lease payments receivable by a lessor under a finance lease and any unguaranteed residual value accruing to the lessor The lease payments under a finance lease of the lessor Present value of the lease payments under a finance lease of the lessor.

1. Gross investment in the lease is equal to Present value of lease payments under a finance lease of the lessor and any unguaranteed residual value. Sum of the lease payments receivable by a lessor under a finance lease and any unguaranteed residual value accruing to the lessor The lease payments under a finance lease of the lessor Present value of the lease payments under a finance lease of the lessor.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter20: Accounting For Leases

Section: Chapter Questions

Problem 8MC: At its inception, the lease term of Lease G is 65% of the estimated remaining economic life of the...

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At its inception, the lease term of Lease G is 65% of the estimated remaining economic life of the leased property. This lease contains a purchase option that is reasonably expected to be exercised. The lessee should record Lease G as: a. neither an asset nor a liability b. an asset but not a liability c. an expense d. an asset and a liability
Gross investment in the lease is equal to a. Sum of the lease payments receivable by a lessor under a finance lease and any unguaranteed residual value accruing to the lessor b. Present value of the lease payments under a finance lease of the lessor. c. The lease payments under a finance lease of the lessor d. Present value of lease payments under a finance lease of the lessor and any unguaranteed residual value.
For a direct-financing lease, the gross investment of the lessor is equal to the a. Present value of the minimum lease payments minus the unguaranteed residual value accruing to the lessor at the end of the lease term. b. Lower of 90% of the present value of the minimum lease payments or the fair value of the leased asset. c. Difference between the fair value of the leased asset and the deferred interest revenue. d. Minimum lease payments plus the unguaranteed residual value accruing to the lessor at the end of the lease term.
The difference of gross investment in the lease and net investment in the lease of the lessor is? A. Total amount of interest that the lessee shall recognized as interest expense over the lease term. B. Interest income at inception of the lease. C. Total amount of interest that the lessor shall recognized as interest income over the lease term. D. Initial direct cost.
In finance lease, the amount recorded as asset is the lower amount between: a. the fair value and the present value of the maximum lease payments b. the fair value of the asset and present value of the minimum lease payments c. the fair value and present value of the asset being leased d. the fair value of the minimum lease payments and present value of the asset
In a sale-leaseback transaction, the lease liability is equals to: A. PV of lease payments accruing to the lessor B. PV of lease payments accruing to the lessor plus any additional financing C. PV of lease payments accruing to the lessor less any prepayments D. PV of lease payments accruing to the lessee
The initial direct costs incurred in relation to a lease transaction is added to A)the cost of sales of lessee under a sales-type lease B)get the net investment for the lessor under a direct finance lease C)get the net investment for the lessor under a sales-type lease D)get the right of use asset for the lessor
The amount to be recorded as the cost of an asset under a finance lease is equal to the present value of the lease payments. carrying value of the asset on the lessor's books. present value of the lease payments plus the present value of any unguaranteed residual value. present value of the lease payments or the fair value of the asset, whichever is lower.
The lessee normally measures the lease liability to be recorded as the: Select one: a. Present value of the minimum lease payments. b. The future value of the minimum lease payments c. The fair market value of the leased asset. d. The sum of the cash payments over the term of the lease.
Which of the following is a criterion for classifying a lease for a lessee as a finance lease? The lease term is for a major part of the asset’s economic life. The lease transfers ownership of the asset to the lessee at the end of the lease term. The present value of the lease payments equals or exceeds substantially the asset’s fair value. All of the above.
On the balance sheet, the lease liability is measured as ________. Group of answer choices the present value of the lease payments less the present value of the guaranteed residual value (if any) the present value of the lease payments plus the future value of the guaranteed residual value (if any) the present value of the lease payments plus the present value of the guaranteed residual value if the lessee guarantees it(if any) the future value of the lease payments plus the future value of the guaranteed residual value (if any)
The initial direct costs incurred in relation to a lease transaction is added to get the right of use asset for the lessor get the net investment for the lessor under a sales-type lease the cost of sales of lessee under a sales-type lease get the net investment for the lessor under a direct finance lease