AC 311 chapter 15 kahoot

interest expense for a finance lease is expected to ___ each year

decrease

interest expense for an operating lease is expected to ___ each year

decrease

the lessee measures the ROU asset for a finance lease to be recorded as the

PV of the lease payments

the lessee measures the ROU asset for an operating lease to be recorded as the

PV of the lease payments

the lessee measures the lease liability for a finance lease to be recorded as the

PV of the lease payments

the lessee measures the lease liability for an operating lease to be recorded as the

PV of the lease payments

the lessee is an operating lease should record: - interest expense -amoritization expense - a ROU asset - all of the above

all of the above

for the lessee to account for the lease as finance, the lease must meet

any of the 5 criteria created by GAAP

T/F a bargain purchase option is an option to purchase the leased asset at a price equal to its expected fair value

false

T/F total lease expense (interest and amortization) for a finance lease will be the same amount each year

false

amortization expense for the ROU asset in an operating lease is expected to ___ each year

increase

with the exception of the first lease payment, each lease payment typically has a component of:

interest expense and lease payable reduction

amortization expense for the ROU asset in a finance lease is expected to ___ each year

remain the same

in connection with a lease greater than 12 months long, the lessee will always record each of the following except: an asset, expense, a liability, revenue

revenue

distinguishing between finance and operating leases due in large part to the accounting concept of

substance over form

which of the following is NOT a criteria for classifying a lease as Finance: - the leased asset has an alternate use to lessor at the end of the lease - the lease contains a bargain purchase option - the lease term is >75% of the remaining life of the asset - the PV of the lease payments is >90% of fair value of leased asset

the leased asset has an alternate use to lessor at the end of the lease

a leasehold improvement should be depreciated on a straight-line basis over

the shorter of the lease term or useful life of the improvement

T/F all other factors remaining equal, the amount of interest expense recorded for a finance lease is the same for operating

true

T/F all other factors remaining equal, the annual lease payable reduction for a finance lease is the same for operating

true

T/F total lease expense (interest and amortization) for an operating lease will be the same amount each year

true