Packer Company (the lessor) concludes that its lease meets one of the tests to be classified as a sales-type lease. However, collection of lease payments is not probable. In this case, how should Packer account for any lease payments received?

Packer Company (the lessor) concludes that its lease meets one of the tests to be classified as a sales-type lease. However, collection of lease payments is not probable. In this case, how should Packer account for any lease payments received?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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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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