f the lessor meets any one of the five Group I criteria, then the lessor classifies the lease as a(n) ________. If the lessor meets both of the Group II criteria, but none of the Group I criteria, then the lessor classifies the lease as a(n) ________. If the transaction does not meet either the Group I or Group II criteria, then the lessor classifies the lease as a(n) ________. Group of answer choices operating lease; direct financing lease; sales-type lease direct financing lease; operating lease; sales-type lease sales-type lease; direct financing lease; operating lease standalone price lease; sales-type lease; direct financing lease

f the lessor meets any one of the five Group I criteria, then the lessor classifies the lease as a(n) . If the lessor meets both of the Group II criteria, but none of the Group I criteria, then the lessor classifies the lease as a(n) . If the transaction does not meet either the Group I or Group II criteria, then the lessor classifies the lease as a(n) . Group of answer choices operating lease; direct financing lease; sales-type lease direct financing lease; operating lease; sales-type lease sales-type lease; direct financing lease; operating lease standalone price lease; sales-type lease; direct financing lease

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter11: Notes, Bonds, And Leases

Section: Chapter Questions

Problem 14Q

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Similar questions

Which of the following statements about purchase option is correct? The lessee includes its present value on the computation of lease liability only if it is guaranteed. None of the other choices is correct. It is ignored if the leased asset reverts back to the lessor at the end of the useful life. Its present value is added to get the lease liability if it is reasonably certain that it will be exercised.
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?
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.
A lease agreement will qualify as a finance lease if one of these conditionsoccur: A. The lessee returns the leased property to the lessor at the end of the lease term.B. The lease does not have a bargain purchase option.C. The lease term is for major of the economic life of the asset.D. The present value of the minimum lease payment amounts to substantially less than the fair value of the leased asset.
What is the basic difference between the accounting procedures used by a lessor for a sales-type lease and those used for a direct-financing lease?
What is a substitution right, and when does that right result in a contract not being a lease?
What are the primary benefits to a lessor of entering into a lease arrangement?
determining whether a contract is or contains a lease? 1. Which of the following is not one of the criteria when c. Right to obtain substantially all of the economic benefits from use of an identified asset throughout the period of 'identified' if it is implicitly specified in the contract. C. the customer shall not account for the contract as a lease if a. the customer shall not account for the contract as a lease. b. the customer shall account for the contract as a lease. d. the customer shall account for the contract as a lease if that it has the right to direct the use of the asset. PROBLEM 2: MULTIPLE CHOICE - THEORY a. Identified asset b. Identified liability from use of an identified asset throughout the period of d. Right to direct the use of the identified asset throughout the period of use use 2. Which of the following statements is incorrect? a. An asset can be 'identified' if it is implicitly specified at the time it is made available for use by the lessee. b. In a lease…
How do the lessee and lessor will agree to modify the terms of a lease before the lease term ends?
Explain when and how a lessee accounts for a lease by the short-cut method.
Under ASPE, the lessor is required to expense any direct costs associated with a lease up front. True False Kindly solve it.
Which of the following is a criterion for classifying a lease for a lessee as a finance lease? The lease term is for a major part of the asset’s economic life. The lease transfers ownership of the asset to the lessee at the end of the lease term. The present value of the lease payments equals or exceeds substantially the asset’s fair value. All of the above.