Answered: In accounting for a Type B lease how…

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

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 13GI: What is the basic difference between the accounting procedures used by a lessor for a sales-type...

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Concept explainers

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.

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In accounting for a Type B lease how are the

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

In accounting for a Type B lease how are the

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What is the basic difference between the accounting procedures used by a lessor for a sales-type lease and those used for a direct-financing lease?
Why are compound interest concepts appropriate and applicable in accounting for a sales-type lease?
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
In accounting for a Type B lease, how are the lessee’s and lessor’s income statements affected?
In accounting for a Type A lease, how are the lessee’s and lessor’s income statements affected?
In a Type A lease, “front loading” of lease expense and lease revenue occurs. What does this mean, and how is it avoided in a Type B lease?
In accounting for a finance lease/ Sale-type lease, how are the lessee's and lessor's income statements affected?
In accounting for an operating lease, how are the lessee’s and lessor’s income statements affected?
When should a lessor recognize as income a nonrefundable lease bonus paid by a lessee on signing an operating lease? at the inception of the lease over the lease term at the lease expiration when received
A lease might specify that lease payments may be increased (or decreased) at some future time during the lease term depending on whether or not some specified event occurs such as revenues or profits exceeding some designated level. Under what circumstances are contingent rentals included or excluded from lease payments? If excluded, how are they recognized in income determination?
Explain when and how a lessee accounts for a lease by the short-cut method.
For the lessor to account for a lease as a sales-type lease, the lease must meet: