Lease

Under a finance lease agreement, the lessee is to recognize...

 

• the interest rate implicit

   

• lease income and expense

   

• lease expense and lease liability

   

• Right of use asset and lease liability

The lessee may apply the operating lease model under what condition?

 

• short-term lease

   

• short-term lease and low value lease

   

• under all circumstances

   

• operating lease and financing lease

Which statement is true about low value lease?

 

• An underlying asset does not qualify as low value lease if the nature of the asset is such that the asset is typically not of low value when new.

   

• All these statements are true about low value lease

   

• The value of an underlying asset is based on the value of asset when new regardless of the age of the asset.

   

• The term of the low value lease may be more than 12 months.

A right of use asset is initially measured at ...

 

• revaluation value

   

• current cost

   

• fair value

•  

  cost

The right-of-use asset comprises all except...

 

• advance rent

   

• Leasehold improvement

   

• present value of lease payments

   

• initial direct cost incurred by the lessee

The right of asset is reported as...

 

• a separate non-current asset

   

   

• Property, Plant and Equipment

   

• investment property

   

• intangible asset

A lease liability is measured at 

 

• fixed payment of lease

   

• present value of lease payments

   

• fair value of the underlying asset

   

• absolute amount of lease payments

What is the interest rate used when the implicit interest rate cannot be determined?

•  

  average borrowing rate

   

• floating rate

   

• incremental borrowing rate

   

• variable rate

In computing for the depreciation for the right of use under a lease, the lessee should deduct...

 

• the residual value guarantee and depreciate over the lease term

   

• Unguaranteed residual value and depreciate over the lease term

   

• guaranteed residual value

   

• residual value guarantee and depreciate over the life of the asset

Rent payment received in advance by the lessor in an operating lease should be recognized as revenue...

 

• at the lease inception

   

• when the lease expires

   

• when received

   

• in the period specified by the lease