Kieso, et al (2009): Ch.

21
PSAK N0. 30
Materials
IAS No. 17

Transportation (Truck,
Aircraft, Bus)
Information Technology
Residual values. Lessee
Construction Comp
Sales-type leases (lessor). Agriculture Comp
Players
Bargain purchase options.
Banks
Initial direct costs. Special Leasing Problems Lessors Leasing Comp
Current versus noncurrent
classification. Independents

Disclosure.
100% Financing at Fixed Rates.

Classify the lease Protection Against Obsolescence.

Implicit interest rate Flexibility.

Determine the PV of asset and
Incremental lease liability Advantages Less Costly Financing.
borrowing rate Tax Advantages.
Effective-Interest Off-Balance-Sheet
Method Used to Financing
allocate each lease LEASING
payment between Make the lease
principal and interest. payment table What are the conditions?

present value of the Transfer of ownership

minimum lease Accounting by Lessee
payments Accounting option price and the
(excluding expected fair market
Asset and Liability value must be large
executory costs) or Recorded at the lower bargain-purchase
option enough
fair-market value of of:
the leased asset.
Record the Lease term is
If lease transfers journal entries generally fixed,
ownership, Lease term is for noncancelable
depreciate asset over major part of
Bargain-renewal option
the economic life of Capital/Finance Lease economic life
the asset. probability to exercise
Types of leasing for lessee of the option
Depreciation Period
the term of the lease
Minimum rental
payment
lease payments amounts to Guaranteed
substantially all of the fair residual value
value of the leased asset
Penalty for failure to
renew or extend
Bargain-purchase option
Operating Lease

LEASING (2).mmap - 15/05/2015 -