Identify each of the following statement as True or False:

• According to AASB 16, lessees always have to recognise a lease on their balance sheets whereas lessors can classify a lease as either a finance lease or an operating lease. TrueFalse
• For lessees, one of the implications of the on-balance sheet treatment of a lease is increased return on total assets and increased debt ratio. TrueFalse
• If a lease is classified as an operating lease, lessors should depreciate the underlying asset over its economics useful life, rather than over the lease term. TrueFalse
• Bargain purchase option describes the right of the lessee to purchase the underlying asset (if reasonably certain) at a price equal to or less than the estimated fair value at the end of the lease. TrueFalse
• An indicator suggesting a lease is an operating lease is when a lease contract can be cancelled by lessee at any point during the lease term. TrueFalse