Question
How does a bargain purchase option affect the calculation of the lease payments charged by the lessor? (IO 22) The option will increase the amount
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How does a bargain purchase option affect the calculation of the lease payments charged by the lessor? (IO 22)
The option will increase the amount of the lease payments.
The option will decrease the amount of the lease payments.
No impact. The option is only part of the final entry.
There is not enough information provided to determine the effect of the option.
5 points
QUESTION 12
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(5 points) Which of the following pieces of information would NOT required for a LESSOR to complete its lease amortization schedule? (IO 20)
The value of a guaranteed residual
The direct costs for creating the lease
The lessor's interest rate for the lease
The lessor needs all of this information
5 points
QUESTION 13
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(5 points) Which of the following would be capitalized as the cost of a Right of Use Asset by a lessee if the lease is classified as a finance lease? (IO 20 & 21)
present value of the lease payments or the fair value of the asset, whichever is smaller
present value of both the lease payments plus and an unguaranteed residual value
present value of the lease payments
lessor's carrying value of the asset
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Accounting for Non-Accounting Students
Authors: John R. Dyson
8th Edition
273722972, 978-0273722977
