On the balance sheet, the lease liability is measured as ________. B) the present value of the lease payments less the present v

Question

2 years ago

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On the balance sheet, the lease liability is measured as ________. B) the present value of the lease payments less the present v

alue of the guaranteed residual value (if any) D) the present value of the lease payments plus the future value of the guaranteed residual value (if any) C) the future value of the lease payments plus the future value of the guaranteed residual value (if any) A) the present value of the lease payments plus the present value of the guaranteed residual value if the lessee guarantees it (if any)

Business

1 answer:

nirvana33 [79] · Answer 1 · 2022-05-31T23:17:02+03:00

Answer:

The correct answer is option (b) The present value of the lease payments less the present value of the guaranteed residual value (if any)

Explanation:

For balance sheet, the liability of lease is measured as the present value of lease payments less the present value of the guaranteed residual value.

Normally, the equipment been leased by the company will record the equipment as an asset, and a liability will be recognize by the company on the balance sheet, by an amount identical to the present value of the lease minimum payments lease residual value guaranteed, if there are any.