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    Copyright:

    © All Rights Reserved
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    18 views22 pages

    Anima Aziz, Id-1818

    Uploaded by

    avi dotto
    fnb 2

    Copyright:

    © All Rights Reserved
    Download as PDF or read online from Scribd
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    Assignment on Accounting for Leases Course Title: Financial Accounting-2 Course Code: MGT 204 Submitted to: Ms. Tanjila Hossain Assistant Professor Department of Accounting Sdnformation System. Submitted by: Anima Aziz ID: 1818; Semester: 3% Batch: 9" Department of Management Studies Jahangirnagar University Savar , Dhaka. Scarned ith ConBcener 1 Answore’- The mason lessor groups ane banks » captive leasing companies » and independents - Caplive leasing companies have “the point of sale ad verge. In -linling leasing ctustomerzs + that is as soon as a arent tecelves o possible onder» a lease Ainoneing oactangament con ba devoloped ty ths leasing. subsidiary - Tathoremore, the captive. lessor han the -produck knovledgo ahich ger ik on ‘ad whon -finanning the pacreortts product the, curacont trend in tor captives to -feoun on the. companys IL redhare than to do. general leane.—Knoneing Anmwere— (29 Restble oclariage. oF lensing A+ Leann} qoarenits the undle- oF of tho. fall cast of the ae qroviding o. qossible. tox advantage: i feytble in that: the. lease . Leas’ bo. mone : oe cortsin. less srontgictive. provisicwy than the bond indenture: Scared vith ConScaner B Leasing gevontls a, “Tooringy oF aces 4. es may ponetl me @aid rapid changon in equipment, sroduee the isk of obsolenconco and pass 2 tke, in tteridual value ® the lescrr orthénd pastly . 5. Bbrtid of: off talance ~shool- Ninaneing with cermin pon of leases. Assuming thet fonds are readily available through. debt inanctng » therce wry mot great advasrtaon xe signing » mnon—comeclabl a, log term. lease. Ona of the usual advorrtocan of leaving. is ts avrailobtlty when ondore dobk Finameing ts unavailable - &) Pesthla dtsadvarrtagen of leaning A+ In on ever-increasing inflationary cememny -eelening title +o assaty May be denireble ay a hedge, again inflection. Scarned ith ConBcener — [2 Tleveat rales “Fic loving oflon axe. Wghew end © preltt Lelore my bo tncluded tn adition. & Ty ame cases, ousting tho assot: qroviden unique tax advantages. such as when bonun doprociction in qerenitted. te) ime ao byg-teram -non-conaebble leose which in ured bn a inaneing device generally -rosults in. the copitalizabiey oF the leaned assets ond seecegattion oF the leona commitmant in she elatornent- of financial qonition the. oonyparcativa effect is not vary. different: rem qucahane ‘ond owngrhip. Assets leaned under auch -erem usuld bo capthalized at the qresont value of tho Heke teare. qoymants » hh value in cprobobly ssneuhak- equivalonk to cha eprenont value of he Ficlure feana_ payments thin value. i probably. Aare what equivalerd - Searned ith ConBcemer (BJ Lew lessees have available uo Teneo accounting methods» wy the operating method ond &) the Ainaneo-leane method Under -he operating method the Seanod asset comin the propertly of she. Leonor whith he payment oF a Leone tanta -raeegnized on -rontal. expome - Generally the lessor & barrgain, qrehaso. option » & quattenteed terenidual value» ond a penalty fer failune to renew Line leaso -the «puenorst voluo. of the minimum \eos.e- Pay mens ts aapttalized by -the lessee. 6. Amwent= The distinction, between a. direct ooneing lease and @ soles --type aasa ts the Presence or aksome. of A monufactnen’s ordal dealers profit . L sales -typo. forse. Pmelven ow Tomufactunand on dealerh pref and @ dinoct financing, \eane dean not. The qroft is ho difference behween -tha fain value oF the [eased prcoperty ak inception of leoneand the lensores cont om emteyyin g- value . Scarned ith ConBcener 7 Arwert- Under lhe opening method » a-tent exponre aceruen doy by day 4o -the lessee an the Kproperdy fs sid the lessee assigna jtomk to-tha periods banefing fom the une of the asset ond qneter in the. accounting ty cammitmonts to make “tehene parrots - Dppropricke. acenuals are rade iF the accourting- (Perdod ends efucan cash paymnart deden- @ Annwort- Undere the ~fineence- lease rncthod the lesieo. Lnarls the lease -tomaction an tf the amet wore bai @urchared a an. s installment basis : ihancial tromackion in which, on assok is aeautrad and a fabri tr oneated » the. assot and the. habitty are. ateded in tho lessoe!s statement of fanetal. Garttion at the tousor of Ly he qrasont value of to srnirimum Deore paymants during So Lease tora ot 3 he Cire value of the Scarned ith ConBcener ered arr at tho thooplion oF the Leara .“the present Nalinc of the Jeane. poymonts in esimpuled wing the impbtetl realo nod by the losane untoss FE te impracticable. the lesee do delormine.—the effective inteneat- method is ured to alloadte oaah. Loare payment bolwoon. 0. reoduction. of the Leane. inbtlety, and inlerat expense - ©. Amnuont- Ficom the standpoint of the ‘essor leaner may bo. clasified Br accoumting. Purepases arte classified ans 2» ofpreating Jeanans dinael—finameing Sennen ond ® walen type Season « From the dundpint of lesson, Leases amet ba. ane classified as financo leasos aF has arnoot: ore ere Tene of “the lowing. iiere ertteris.* 4. The lease tronnfern cunerahip of -the proopercty to —the lessea- Scarned ith ConBcener 9. Tho Tengo. contains - argpin purine option. S The. lease -form tn fore tho Thaler part of -the eesnemie Site. of the amet ae Jeoses ane. classified an diret- finomeing leaner on raler ype leaner. All thor. Seaner ante classified an - Operating feases «tha dintinelion forth. tessom between a dirceat-—finaneing heare and a saler-type Jeare_ in the Grenence or absono of & manufacturers onagblen’s ° profit on Lass to: Amwer— 4f the lease -ticangaction saline the mnecessamy emitorda, -fo be closwified an a creck financing. leane, tho lossare record a “fearo rrtoeivable “tir -the Lured anack The ear recchabla in the pracant value of tho emninimum aane. payments . Minimum lease qoyment: indude the. tonto poymants 3 bargain purhare option .gearcanteod tesidual. value ond ant: ponatty foreetturia to renew «tn Scarned ith ConBcener ackition. the preent- valto of tho Ungrarantend residual value tnunt also be included .~thy Lease rreeeivalle in then Aeourted fer simile 46 a nole “receivable, using the | effective rterast method. 144. Anywortt- Undere “he. oporeaing method» each reontal ftteceipt: of the. lessor ta reearededd a» —teontal, Teevenye on Lhe uce of on trem carried as a fxd asset’. the fixad. iannot in dopraniactod in -tho Termal Tanrwz, with the_ | deprinctation expense. necegnized inthe same period an tho tortal tuvenve ~The amount of ~revenue regres tn each. accounting. peru is equivalent to he amount oF rank reeeivele according to “the provisions of the tame . Hy ockitim to be depraciatin chose. molrtenonee carts ond Be ecels oF omy other senvicen rendered under-to he. provision of -the feane. Scarned ith ConBcener 5. Auer t-@) (A) The lessoo% account ig ore a Jeane, with lon under unguarcared srondual velue tp tho some an the ccourting bre a Leone wilh no rronidual value in “erm oF computation of —ha -sninirmm leare wymonts ond “tre aapitabized vitlie of: -the Leaned ana: and ha Leone cbligation ia A geronbed ronal yalue affeds the ksso2’s o ion of the. rainimurn Jeare payments and he copttalized. ampunt of the Faved ancl ond toare ab tiabilty the copttalized value ts affected inthily by ~the presenee oF Quacentead rearidual value since ~the prenent value of tha Jeane. obligation. in row modo_up of tuo componants—the poredic. eave prymonts ond the quatcamteed tonidual value. Tha lization of to. Serra Ounbility utll treault tn @ Aeonre_ Qrability. bolomee ak-the end of the Leare poriod whieh in equal +6 the Quattanteed! reridual value. Scarned ith ConBcener °C) £@ “he amount bo tecooned iy the Penson. is the same whothere the tranidual value tn guarvortoad pe tungecarcarrtacd + Theratoria,, tha amount of the perwodce, Hear e, Payments an rok by -the lastore in the ame whethoz the Mendlual value ts quaramteod orc anguaronteed « 17- Amwere— IF a bargain qurchane option extats the care gust inewoare te. Parment value ofthe minimum feane qoymonts bythe Prerent value of the option prco. A bargain gurichare option alse affects the depreciable Lbefe of the feared annok since -the Leare mmunt depreciate the arnnck over its eenomic Me rodho Hho. the. tonm ofthe lease . HF -the Lessee -feil -to exerelse ~he option the lessee ull recognize & Loss yo —the extont of the not boole value of the leaned rnek in the eporciod that —the option expired. Scarned ith ConBcener : — Tntial dineot corls ane the inecemen tnoutetod by tho. lossore lhe aro ctreectly annodated with. Pnegehecting esnnuminaling and inilially processing. Seosing- Hreamnactison. Fre oporing feonen ba. forse should eater inthal dineol= casts and aflecato thom oor the. (eoueeoum tr proporctsn -to ~the “races Hin of tenlal rovenva: Ina salon - po. teane trompation the Vossen expoma a intial china: cots ny the yoar of imeurmence - In a Aipool finanes Doane , intial direot cents trould bo added tothe nak invertment in the feare. 19. Arpwor'— Lessaos and learcr should davarz. diralaso the dune minimum tental payments tequrread an of “the. cede oF tho Selon chttomant of Finaneral pariion presented Searned ith ConBcemer (OOThis ts oNinone \easo-to Yenson sfrco she lease Joram ts greater. than 75% of tho economia ifo of the loaned assob “The loane -leram 8% C724) tho assok$ econemic. fife. This is afinama lease to Glau becoune the leare feren is gqrecden thon #57. oF the ands economia Wife. inca Yo faire value ce 700600) oP the equipmont exceeds the. lessor’s cont (E625 668). Hthe. loare is a solen—type lease. ) Collation of onnual rental paymont:— 5.95526" = €4124130 ¥ Prosont volua. of €2.ak 40% fon J Perodn. #% ®rosont value of an armuity duo ak toz for. Poriods. Scarned ith ConBcener FD Compilation of Renonl valua of minimum Jeane poymarts: PV of omnual qoymorts €124130%5.230 = 639575 @v of quatantecd reoricual value E N00006 % 4 RI 66= “18166 CRIL7aL ®) Vans Leaned Equipment C8174 leare Siabrity 681744 Leane Lal lity 124430 Can 124130 4%/31/15- —— Depreciedion expanse E3106 Accumulated! Doprasiatin- -@8196 Equipment Trloront expome. > 6467. Aiterent payable Creed 4fa/ le Leane Liability SOLES Tinterant Ryable 61464 Cash. 121430 Scarned ith ConBcener Accumalod Soprociakion— Leanod equipmont ¢t 8 3406 Trlonart expome— dr 55426 Antenert myable on BEALL V1/15 leare trecoivalie. 4% 700000 conts of broods Sold dn 525000 Salen revenue. en_— 7700000 2. 10 Tnventory en P2900 Canh_ dn AQ11.30 loana ~teceivable en 421130 Yair Inforort recoiabe. dn IRF Tntorort revenug a SFREL Searned ith ConBcener | ae Vit eanh loana. receivable 63243 Intonent yoceivable sHBet H2/si/ic Anborest -raoivable 515s Anterort revenue BI 56S ta) tho. lease is on operating lease. otha lessee and laser: becaune”. 2) 1b dleon spol srosystor. aunerahtp «: kay ik doen wok aontttn a baygain ~Purcehane option la) te deen not coverc the macyor, port (ot toot 15 7) of the erlimakod eemnomie §cO of the stone €4) the qresent volve of she kaso qoyments doen not amount to substomrtialy all of the Fair value, of the = Seased eone - Scarned ith ConBcener RH 23000 Armual Lease Bymonls X ev oF annutly dua Ak OA “for ] yams KF.3900% 4] - 2372 = RG19D910-46 Which ts bss thom RALACO00 (00% X RH 22410006) « Al least one of--the four ercflerio. would hove had fo bo satisfidd fore tha teu 4» be classified om athar han an operaling. leane + © Leseo5 Entrion Rent Epanse 4

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