Question 1

A lessee when accounting for a lease incentive received under an operating lease treats is as a:

Accepted Answer

A)  increase in rental income over the lease term 
B)  increase in rental expense over the lease term 
C)  reduction in rental expense over the lease term 
D)  reduction in rental income over the lease term 
A)  increase in rental income over the lease term 
B)  increase in rental expense over the lease term 
C)  reduction in rental expense over the lease term 
D)  reduction in rental income over the lease term

Question 2

Nelson Ltd manufactures specialised machinery for both sale and lease. On 1 July
2013, Nelson leased a machine to Poggi Ltd. The machine cost Nelson Ltd
$195 000 to manufacture, and its fair value at the inception of the lease was
$212 515. The interest rate implicit in the lease is 10%, which is in line with current market rates. Under the terms of the lease, Poggi Ltd has guaranteed $25 000 of the asset's expected residual value of $37 000 at the end of the 5-year lease term. The debit to the sales revenue account in Nelson's books is:

Accepted Answer

A)  $187 548 
B)  $195 000 
C)  $205 063 
D)  $212 515 
A)  $187 548 
B)  $195 000 
C)  $205 063 
D)  $212 515

Question 3

A finance lease is an agreement between an owner of an asset and a user of that asset wherein the:

Accepted Answer

A)  legal title to property is transferred to the lessee when the first lease payment is made 
B)  ownership passes to the lessor on inception date of the lease 
C)  substantially all of the risks and benefits of ownership remain with the lessor 
D)  usual risks and benefits of ownership are transferred to the user 
A)  legal title to property is transferred to the lessee when the first lease payment is made 
B)  ownership passes to the lessor on inception date of the lease 
C)  substantially all of the risks and benefits of ownership remain with the lessor 
D)  usual risks and benefits of ownership are transferred to the user

Question 4

The user of a leased asset is referred to as the:

Accepted Answer

A)  vendor 
B)  purchaser 
C)  lessor 
D)  lessee 
A)  vendor 
B)  purchaser 
C)  lessor 
D)  lessee

A lessee when accounting for a lease incentive received under an operating lease treats is as a:

A finance lease is an agreement between an owner of an asset and a user of that asset wherein the:

The user of a leased asset is referred to as the:

Accounting Regulation and the Conceptual Framework

Application of Accounting Theory

Shareholders Equity: Share Capital and Reserves

Fair Value Measurement

Revenue

Provisions, Contingent Liabilities and Contingent Assets

Income Taxes

Financial Instruments

Share-Based Payments

Translation of the Financial Statements of Foreign Entities

Employee Benefits

Inventories

Property, Plant and Equipment

Understanding Australian Accounting Standards

Impairment of Assets

Accounting for Mineral Resources

Agriculture

Financial Statement Presentation

Statement of Cash Flows

Earnings Per Share

Operating Segments

Operating Segments

Business Combinations

Consolidation: Principles and Accounting Requirements

Consolidation: Intragroup Transactions

Consolidation: Non Controlling Interest

Joint Arrangements

Associates and Joint Ventures

Filters

Exam 14: Leases

A lessee when accounting for a lease incentive received under an operating lease treats is as a:

A finance lease is an agreement between an owner of an asset and a user of that asset wherein the:

The user of a leased asset is referred to as the:

Accounting Regulation and the Conceptual Framework

Application of Accounting Theory

Shareholders Equity: Share Capital and Reserves

Fair Value Measurement

Revenue

Provisions, Contingent Liabilities and Contingent Assets

Income Taxes

Financial Instruments

Share-Based Payments

Translation of the Financial Statements of Foreign Entities

Employee Benefits

Inventories

Property, Plant and Equipment

Understanding Australian Accounting Standards

Impairment of Assets

Accounting for Mineral Resources

Agriculture

Financial Statement Presentation

Statement of Cash Flows

Earnings Per Share

Operating Segments

Operating Segments

Business Combinations

Consolidation: Principles and Accounting Requirements

Consolidation: Intragroup Transactions

Consolidation: Non Controlling Interest

Joint Arrangements

Associates and Joint Ventures

Filters