Compare the way a purchase option that is reasonably certain to be exercised and a lessee-guaranteed residual value are treated by the lessee and lessor when determining lease payments.

Q: Of what significance is (a) an unguaranteed and (b) a guaranteed residual value in the lessor's…

A: The amount to be recovered by the lessor is the same whether the residual value is guaranteed or…

Q: Briefly describe the conceptual basis for asset and liability recognition under the right-of-use…

A: lessee is the tenant or the person who holds the property or asset under lease. Right of use means…

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: True or False   Lease payments are paid by the lessor.

A: Lessor is the legal owner of the property.Lessor leases the property he owns to lessee for rental…

Q: What is the primary objective of the required lease disclosures for the lessor and lessee?

A:

Q: Explain the impact on lease accounting of uncertainties, including uncertain lease terms, variable…

A: Uncertainties in lease transactions: There are several issues with respect to lease transactions…

Q: What situations cause us to remeasure a lease liability and right-of-use asset How is that…

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

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: Lease payments are payments made by a lessee to a lessor relating to the right to use an underlying…

A: The standard states that lease payments for the lessee includes the following a.) Exercise price of…

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: A lessor will record interest income if a lease is classifi ed as:A . a capital lease.B . an…

A: Introduction: Leasing is a mechanism by which the company may receive certain capital assets for…

Q: accounting processes necessary for a lessee to use the operating lease technique.

A: Operating lease refers to the lease or contract which allows the asset use and it does not convey…

Q: Why is the reporting of leases required? Justify your response.

A: A lease is an agreement where an asset is taken on rent and Lessor receives Lease rental in return.…

Q: Explain the impact on lease accounting of other payments, including nonleasepayments, initial direct…

A: Uncertainties in lease transactions: There are several issues with respect to lease transactions…

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: Why is lease reporting required? Justification for your answer.

A: A lease is an arrangement in which an asset is rented out, and the Lessor gets a rental payment in…

Q: distinguish between a fi nance lease and an operating lease from the perspectives of the lessorand…

A: Difference between a finance lease and an operating lease from the perspectives of the lessorand the…

Q: What are the benefits to lessees of operating lease accounting?

A: Operating lease: The operating lease refers to the contract between two parties where one party…

Q: Explain Nonlease Components of Lease Payments.

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

Q: Why do we need to differentiate lessor accounting for direct financing lease and sales-type lease?

A: Lease contract: Lease contract is an arrangement occurs between two individuals or entities through…

Q: A lessee should classify a lease transaction as a capital lease if it is noncancelable and one or…

A: Explain the criteria for defining the lease as capital lease or operating lease: As per the notes…

Q: Explain the Remeasurement of the Lease Liability...

A: Lease Liability:  In order to determine the lease liability, lease payment information should be…

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: Explain the Uncertainty in Lease Transactions.

A: Uncertainty means something which is not certain and unusual in nature. There are various types of…

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

A:

Q: Can the present value of minimum lease payments differ between the lessor and lessee? If so, how?

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

Q: If the gains or losses from the fluctuation in the fair value of the residual accrue to the lessor,…

A: Lease accounting is the accounting to adjust the transaction where a fixed asset is taken on rent…

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: Outline the accounting processes that must be followed by a lessee when using the operational lease…

A: The question deals with the accounting processes that must be followed by a lessee when using the…

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: In accounting for an operating lease, how are the lessee’s and lessor’s income statements affected?

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

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: What is the main purpose of the lease disclosures required of the lessor and lessee?

A: The Answer:

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 is lease assignment? What is subletting? Explain at least one main difference between these…

A: In the world of finance in general and letting out of properties in particular the concepts of lease…

Q: Compare the benefits and drawbacks to long-term vs. short-term leases from EITHER the point of view…

A: Lease refers to the contract between the parties in which one party agrees for renting an asset…

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: Distinguish between a financing lease and an operational lease from the lessee's standpoint.

A: Financial lease is the arrangement where lessor provides lessee, a asset to use for the major period…

Renting Vs Buying

Renting means occupying a house for a period and paying an amount in exchange for such service. Renting does not require huge investments. Payments under renting are periodic and the amount is relatively low compared to EMIs.