Question
Google Inc. is preparing its financial statements for the year ended December 31, 2023. During the year, the company entered into a lease agreement to
Google Inc. is preparing its financial statements for the year ended December 31, 2023. During the year, the company entered into a lease agreement to rent office space. The lease agreement requires annual payments of $120,000 and extends for five years. However, the lease agreement also contains a provision that if the company's revenue exceeds $5,000,000 in any fiscal year, the annual lease payments will increase by 10%. Google's revenue for the year ended December 31, 2023, was $5,500,000. How should Google Inc. disclose this lease agreement in its financial statements in accordance with the Full Disclosure Principle?
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