FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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If the lessee and lessor use different interest rates to account for a finance/sales-type lease, then what is going wrong?
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- Why does a finance lease is economically similar to a purchase of the asset?arrow_forwardWhat factors would tend to affect the value of a lease?arrow_forwardWhat 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?arrow_forward
- IFRS distinguishes between sales-type and direct financing leases for lessors. True or Falsearrow_forwardCompare the benefits and drawbacks to long-term vs. short-term leases from EITHER the point of view of the lessor or the lessee. REAL ESTATE FINANCEarrow_forwardIf the agreement type is NNN lease then why tenant are not paying their share of CAM, taxes and insurance expenses in this solution ? How to calculate Sale price in excel?arrow_forward
- When is it appropriate for the lessee to use the lessor's implicit rate to calculate the present value of the lease payments? A.when the lessee's incremental borrowing rate is lower than the lessor's rate B.whenever the lessee knows what the lessor's rate is C.when the lessor's implicit rate is lower than the lessee's incremental borrowing rate D.when the lessor's rate is higher than the lessee's incremental borrowing ratearrow_forwardWhich of the following is nota reason why some companies lease rather than buy? A. Leasing may allow you to borrow with little or no down payment. B. Leasing can improve the balance sheet by reducing long-term debt. C. Leasing can lower income taxes. D. Leasing transfers the title to the lessee at the beginning of the lease.arrow_forwardWhat is a short-term lease? Describe lessee accounting for a short-term lease.arrow_forward
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