Leases
Free CPA BAR (Business Analysis & Reporting) lesson in Technical Accounting and Reporting. 21 min read, ~3,116 words.
Lessee classifies as finance if any one of five criteria met (ownership transfer, purchase option reasonably certain, term major part of useful life, PV substantially all of fair value, specialized asset); otherwise operating. Both finance and operating leases appear on the lessee balance sheet under ASC 842. Lessor applies the...
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What this lesson covers
- Content
- Example 1
- Example 2
- Common Mistakes
- Check Your Understanding
- Exam Shortcuts
Learning objectives
- II.I1
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