2). A landlord records the collection of a tenant's security deposit as a(n):            1. liability            2. prepaid expenses            3.  contingent liability            4. contra liability 1). Which of the following statements regarding accounting for leases is true?         a. If the lease term is one year or longer, a liability must be recognized.        b. leases accounting rule will result in more assets and liabilities being recognized on the balance sheet    c. Leasing will likely remain popular because leases do not require a large initial outlay of cash      d. All of these are correct     e. None of these are correct

Part 1: New Lease Accounting – IFRS 16 Leases Effect Analysis. What are the top three industries most affected by IFRS 16 as measured by the present value of future payments for off-balance-sheet leases to total assets? Which leased assets propel them to the top three?  Also, discuss the extent that smaller firms would be affected by IFRS 16. Which payments are to be included in the measurement of lease assets and lease liabilities? Also, discuss the pros and cons of excluding the following payments from the measurement. Variable lease payments linked to future use or sales Optional payments relating to lease-extension option when a lessee is not reasonably certain to exercise the option. Discuss the effects of the new accounting on the following items and ratios of lessees. Provide reason(s) behind all effects. EBITDA, operating profit, and profit before tax Operating cash flow, financing cash flow, and total cash flow Debt to equity, current ratio, and return on total assets

What would be the advantages and disadvantages of leasing assets instead of owning them? How would the financial statements be different in a leasing situation (for both operating leases and finance leases) for the lessee? What about the lessor (including all of the types)? What disclosures should be made by lessees and lessors related to future lease payments?

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