Homework Help is Here – Start Your Trial Now!
Business
Accounting
Are a lease liability and a right-of-use asset required to be recognised by a lessee at lease inception for all leases? LO 11.2 There are limited exemptions. Paragraph 5 of AASB 16 states that a

Are a lease liability and a right-of-use asset required to be recognised by a lessee at lease inception for all leases? LO 11.2 There are limited exemptions. Paragraph 5 of AASB 16 states that a

Intermediate Accounting: Reporting And Analysis
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 8RE: Use the following information to decide whether this equipment lease qualifies as an operating,...
See similar textbooks
icon
Related questions
Question
M3
Are a lease liability and a right-of-use asset required to be recognised by a lessee at lease inception for all leases? LO 11.2 There are limited exemptions. Paragraph 5 of AASB 16 states that a lease liability, and a right-of-use asset, do not need to be recognised where the lease: Is a 'short-term lease', and Is for an underlying asset of 'low value'. A short-term lease is defined in AASB 16 as a lease that, at the commencement date, has a lease term of 12 months or less. However, a lease that contains a purchase option is not a short-term lease. In terms of the value that items would have for them to be deemed to be of 'low value', the IASB suggests they would be in the order of magnitude of US$5000 or less.
Transcribed Image Text:Are a lease liability and a right-of-use asset required to be recognised by a lessee at lease inception for all leases? LO 11.2 There are limited exemptions. Paragraph 5 of AASB 16 states that a lease liability, and a right-of-use asset, do not need to be recognised where the lease: Is a 'short-term lease', and Is for an underlying asset of 'low value'. A short-term lease is defined in AASB 16 as a lease that, at the commencement date, has a lease term of 12 months or less. However, a lease that contains a purchase option is not a short-term lease. In terms of the value that items would have for them to be deemed to be of 'low value', the IASB suggests they would be in the order of magnitude of US$5000 or less.
Expert Solution
steps

Step by step

Solved in 2 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Loanable Funds Theory
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
SEE MORE TEXTBOOKS