ch21 - CHAPTER 21 ACCOUNTING FOR LEASES IFRS questions are...

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CHAPTER 21 ACCOUNTING FOR LEASES IFRS questions are available at the end of this chapter. TRUE-FALSE —Conceptual Answer No. Description T 1. Benefits of leasing. F 2. Accounting for long-term leases. F 3. Classifying lease containing purchase option. T 4. Accounting for executory costs. F 5. Depreciating a capitalized asset. F 6. Lessee recording of interest expense. T 7. Benefit of leasing to lessor. F 8. Distinction between direct-financing and sales-type leases. F 9. Lessors’ classification of leases. T 10. Direct-financing leases. F 11. Accounting for operating lease. F 12. Computing annual lease payments. T 13. Guaranteed residual value definition. F 14. Guaranteed vs. unguaranteed residual value. T 15. Unguaranteed residual value and minimum lease payments. F 16. Net investment and guaranteed/unguaranteed residual value. T 17. Difference between direct-financing and sales-type leases. F 18. Gross profit in sales-type lease. T 19. Review of estimated unguaranteed residual value. T 20. FASB required lease disclosures. MULTIPLE CHOICE —Conceptual Answer No. Description d 21. Advantages of leasing. d 22. Advantages of leasing. b 23. Basic principle of lease accounting. c 24. Conceptual support for treating all leases as a sale/purchase. a S 25. Essential element of a lease. b S 26. Bargain purchase option and minimum lease payments. b P 27. Cost amount for a capital lease. a 28. Lease accounting by lessee. c 29. Knowledge of the capitalization criteria. d 30. Components of minimum lease payments. d 31. Identification of executory costs. c 32. Discount rate used by lessee. a 33. Depreciation of a leased asset by lessee. b 34. Effect of a capital lease on lessee's debt. a P 35. Depreciation of a capital lease. a 36. Identification of lease type for lessor. d 37. Elements of lease receivable by lessor. a 38. Recognition of unearned lease income. c S 39. Direct-financing lease receivable.
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