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- Which of the following are not required disclosures for leases under PFRS 16? the expense relating to short-term leases restrictions or covenants imposed by leases the expense relating to variable lease payments not included in the measurement of lease liabilities total cash outflow for leases leases not yet commenced to which the lessee is committed Group of answer choices Only 5. Only 2. Only 2 and 5. All are required to be disclosed.Which of the following should be included by the lessee in determining the amount of the right-to-use asset and lease liability: a. Fixed Payments: Yes/Unguaranteed Residual Value: Nob. Fixed Payments: Yes/Unguaranteed Residual Value: Yesc. Fixed Payments: No/Unguaranteed Residual Value: Yesd. Fixed Payments: No/Unguaranteed Residual Value: NoPROBLEM 1: TRUE OR FALSE 1. According to PFRS 16 Leases, a lessee shall classify each of its leases into a finance lease or an operating lease. 2. A contract is (or contains) a lease if it conveys the right to control the use an identified asset for a period of time in exchange for consideration. 3. An underlying asset is not considered an identified asset for the purpose of applying the accounting requirements of PFRS 16 if the supplier's substitution right is not substantive. 4. The current view on accounting for leases by lessees is that all leases are 'on-balance sheet' items, with very minimal exceptions. 5. In most leases, a lessee recognizes an asset and a liability at the commencement date. 6. According to PFRS 16, lease payments include any amount to be paid for purchase options that are reasonably certain to be exercised and amounts that are expected to be paid under residual value guarantees. 7. The lessee always uses its incremental borrowing rate in determining the present…
- Statement 1: When the residual value guaranteed by the lessee at the end of lease term is higher than the fair value of the underlying asset, settlement shall be made by the lessee and recognized as a loss.Statement 2: When the residual value guaranteed by the lessee at the end of lease term is higher than the fair value of the underlying asset, no settlement shall be made by the lessee and no recognition of any gain or loss. Group of answer choices Only statement 2 is correct Only statement 1 is correct Both statements are correct Both statements are incorrect.Pollution remediation obligations is related to ---------------Select one:a. Debt servicesb. Long term liabilitiesc. Short term liabilitiesd. None of the other pointsStatement 1: The lessor will recognized the same gross profit whether the residual value is guaranteed by the lessee or not guaranteed by the lessee.Statement 2: Any initial direct cost paid by the lessor shall reduce the amount of unearned interest income that the lessor shall recognized at inception of the lease. Group of answer choices Both statements are incorrect. Only statement 1 is correct Only statement 2 is correct Both statements are correct
- Not yet Statement 1-IFRS 16 paragraph 100 provides that the seller-lessee shall measure the right of use asset arising from the leaseback at the proportion of the previous carrying amount of the asset that relates to the right of use transferred to the buyer-lessor. Statement 2- IFRS 16 paragraph 100 provides that the gain or loss that pertains to the right retained by the seller-lessee is not recognized. Select one: O Only statement is correct O Both statements are corroct O Only statement 2 is correct O Both statements are incorrect44. The right-of-use asset is increased by lease prepayments made by the lessee and initial direct costs incurred by the lessee. lease incentives received. initial direct costs incurred by the lessee only. prepaid lease payments only.7. Which of the following must be done when accounting for depreciation under IFRS GAAP but can be done under U.S. GAAP? a. Depreciate by function b. Depreciate by nature c. Depreciate by components d. All of these 8. When accounting for contingent liabilities IFRS GAAP defines ‘probable’ as a. likely b. more likely than not c. possible d. none of these 9. When accounting for contingent liabilities U.S. GAAP defines ‘probable’ as a. likely b. more likely than not c. possible d. none of these
- 26. In a finance lease by the lessee, the leased asset is depreciated on a systematic basis consistent with the depreciation policy of the lessee. If the the lease is only for a short term and of low value, and the lease contract did not mention as to the classification of such lease nor did it contain transfer of ownership and a reasonable certainty as to the purchase option's exercisability, depreciation by the lessee is * a. Based on the useful life of the leased asset. O b. Based on the lease term. c. Based on the shorter of the lease term or the useful life of the asset. d. Not recognized since the lease is an operating lease and the depreciation expense shall be shouldered by the lessor who retains ownership of the leased asset.t26 If title is not expected to pass to the lessee by the end of the lease term, lease of land is classified asA. operating lease.B. either operating lease or finance lease.C. finance lease.D. neither operating lease nor finance lease.24. One of the following statements is false: * a. If the underlying asset will not revert to the lessor, the residual value is simply ignored by the lessor in the computation of unearned interest income and gross profit on the sale. b. The underlying asset will remain with the lessee if the lease provides for either a purchase option that is reasonably to be exercised or transfer of title to the lessee upon the lease expiration. c. When a lessor actually sells an asset that it has been leasing, the difference between the sales price and the carrying amount of the lease receivable is recognized in profit or loss. d. The gain or loss that pertains to the right retained by the seller- lessee in a sales and leaseback transaction is not recognized.