Describe the effect on the lessee of a “bargain purchase option” on accounting for a finance lease transaction.

Q: Describe how a "bargain buy option" affects the lessee's accounting for a finance lease deal.

A: HERE IS THE ANSWER:

Q: What are some important lease provisions which investors should be aware of when analyzing the…

A: An investment becomes a real estate investment trust (REIT) when it satisfies certain provisions.…

Q: Outline the accounting procedures involved in applyingthe capital lease method by a lessee.

A:

Q: List the sequence of events for the lessee that leads to a lease arrangement.

A: The legal agreement where there are two parties, one party convinces his property to another party…

Q: Discuss the accounting and reporting for special features of lease arrangements.

A: Special features of lease arrangements: - Residual type- Sale type leases- Bargain purchase option-…

Q: What comprises a lessee’s minimum lease payments? What is excluded?

A: A lease is a contractual obligation under which one party (lessee) uses the assets or resources of…

Q: Describe the accounting procedures that must be followed by a lessee when employing the operational…

A: The Question is about the accounting procedures that must be followed by a lessee when employing the…

Q: Describe the accounting processes that a lessee must follow while using the operational lease method

A: Here is the Answer :

Q: Why would a lease include a contingent payment provision? Explain.

A: Contingency payment provisions is a provision for a possible event or circumstance which is not…

Q: Why is it appropriate to compare the cost of lease financing with that of debtfinancing?

A: Cost of lease financing is the cost that is bear by the lessee who have owned the right from the…

Q: Explain when and how a lessee accounts for a lease by the shortcut method.

A: The shortcut method is when the lessee and the lessor don't account for the lease at its…

Q: What do you think is the main difference of accounting for lease on the part of the lessee and…

A: Lease is regarded as the contract between two parties those to use the asset of the owner by another…

Q: Where can we obtain reliable guidelines on IFRS lease accounting?

A: It is dealing with where can we obtain reliable guidelines on IFRS lease accounting

Q: At the beginning of a Type B lease, the lessor will record what asset and liability, if any?

A: Lease:An agreement of contract that is made to transfer the right to utlize the resources for a…

Q: Describe the qualitative and quantitative lease disclosure?

A:

Q: When can a lease create both an asset and a liability for the lessee?

A: Lease is an agreement between two persons in which one grants the right to another to use a…

Q: Explain the difference in lessor income statement presentation for a sales-type versus operating…

A: Lease: Lease is a contractual agreement whereby the right to use an asset for a particular period of…

Q: Explain the nature, economic substance, and advantages of lease transactions.

A: Lease:   It is an agreement between two parties where the one party agrees to rent an asset owned by…

Q: From a lessee perspective, distinguish between a finance lease and an operating lease.

A: Lessees have available two lease accounting methods: (a) the operating method and (b) the…

Q: What is difference between lease method and installment method?

A: Lease:   It is an agreement between an owner of an asset (Lessor) and a tenant (lessee) where the…

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: The term of a finance lease includes the initial lease term and any bargain renewal terms.    True…

A: The answer for the True or false question is discussed hereunder : What is a finance lease?  Finance…

Q: In accounting for a Type B lease, how are the lessee’s and lessor’s income statements affected?

A: When accounting for finance lease/ Sales type lease, lease payments are made during the term of…

Q: What are the primary benefits to a lessor of entering into a lease arrangement

A: The primary benefits to a lessor of entering into a lease arrangement will be explained:

Q: Describe the accounting procedures involved in applying the finance lease method by a lessee.

A: A lease is a written agrfgdhdfA lease is a written agreement that indicating the conditions within…

Q: Describe about the EFFECT OF A RESIDUAL VALUE ON LEASE CLASSIFICATION?

A: Introduction Residual value is the amount, the asset's owner earns after selling/disposing that…

Q: Describe about what is the lessor, lessee and lease contract.

A: Lease Contract:   Lease is a contractual agreement whereby the right to use an asset for a…

Q: Describe about the lease expenses in a finance lease?

A: Finance lease: The finance lease refers to the contract between two parties which satisfies the…

Q: Compare the way a bargain purchase option and a residual value are treated by the lessee when…

A:

Q: How is interest determined in a capital lease transaction? How does the approach compare to other…

A:

Q: In accounting for a Type A lease, how are the lessee’s and lessor’s income statements affected?

A: To state: how the lessee’s and lessor’s income statements are affected by finance lease/sales-type…

Q: The basic concept of “substance over form” influence lease accounting. Explain in detail how it does…

A: Substance over form is an accounting concept that business transactions should be accounted in…

Q: What disclosures should be made by lessees and lessors related to future lease payments?

A: Lease: Lease is a contractual agreement whereby the right to use an asset for a particular period of…

Q: The appropriate asset value reported in the balance sheet by the lessee for an operating lease is:

A: GIVEN   The appropriate asset value reported in the balance sheet by the lessee for an operating…

Q: What is the difference between an operating lease and a financial,or capital, lease?

A: Lease: Leases are agreements in which the proprietor of the asset permits another party to utilize…

Q: What are the required lease disclosures for the lessor and lessee?

A: Lease: Lease is a contractual agreement whereby the right to use an asset for a particular period of…

Q: Explain the accounting involved in applying the operating lease method by a lessor.

A: Operational lease method: A process of using the asset for a rental payable in instalments or in…

Q: Describe the lessee's accounting for sale-leaseback transactions.

A: Meaning:

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: How do the lessee and lessor will agree to modify the terms of a lease before the lease term ends?

A: Lease Agreement:   It is a contract between the owner of an asset (lessor) and a tenant (lessee) for…

Q: What discount rate should be used to evaluate a lease? Why?

A: Lease may be defined as the legal contract between two party's lessor and lessee, were one party…

Q: Compare and contrast a finance lease with an operating lease.

A: Lease:   It is an agreement between two parties where the one party agrees to rent an asset owned by…

Q: Define the term NAL as it is used in lease analysis,and then explain how the NAL is calculated.

A: Net advantage to leasing (NAL) refers to the monetary savings or the money that a company or…

Q: What is a short-term lease? Describe lessee accounting for a short-term lease.

A: Short-term LeaseThis is a type of leasing which has a maximum lease term ranging from 1 year or…

Leasing

Leasing is a contractual arrangement in which someone (a lessee) pays the owner (or lessor) of a building, land, vehicle, or other asset for the use of that asset. The lease is the agreement between lessee and lessor.