Question

Under ASC 840, operating leases require note disclosure of minimum lease payments for the: Multiple Choice...

Under ASC 840, operating leases require note disclosure of minimum lease payments for the:

Multiple Choice

1. amount of annual rental payments for the next five years.

2. discounted present value of future lease payments for the total of the next five years and the aggregate thereafter.

3. undiscounted present value of total future lease payments.

4. future cash outflows for each of the next five years and the aggregate thereafter.

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Answer is option 4

4. future cash outflows for each of the next five years and the aggregate thereafter.

According to ASC 840, the disclosure simply includes the maturity schedule. This schedule includes future cash flows (Committed payments) of the next five years and the further payments are aggregated. There was no application of discount rates for operating leases. To overcome all these short-comings of ASC 840, the new lease standard ASC 842 is applied.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Analyzing and Capitalizing Operating Lease Payments Disclosed in Footnotes YUM! Brands, Inc. discloses the following in...
Analyzing and Capitalizing Operating Lease Payments Disclosed in Footnotes YUM! Brands, Inc. discloses the following in Note 11 to its 2014 10-K report relating to its lease commitments: (in millions) Capital Leases Operating Leases 2015 $20 $709 2016 21 661 2017 20 609 2018 20 555 2019 20 501 Thereafter 181 2,444 Total Minimum lease payments $282 $5479 At December 27, 2014, the present value of minimum payments under capital leases was $175 million. Operating leases are not reflected on-balance-sheet....
Analyzing and Interpreting Footnote on Operating and Capital Leases Assume Verizon Communications, Inc., provides the following...
Analyzing and Interpreting Footnote on Operating and Capital Leases Assume Verizon Communications, Inc., provides the following footnote relating to its leasing activities in its 10-K report. The aggregate minimum rental commitments under noncancelable leases for the periods shown at December 31, 2010, are as follows: Years (dollars in millions) Capital Leases Operating Leases 2011 $ 83 $ 1,449 2012 71 1,316 2013 67 1,056 2014 63 806 2015 46 527 Thereafter 161 1,937 Total minimum rental commitments 491 $ 7,091...
The Company leases retail, distribution and office facilities, which expire at various dates through 2036. Future...
The Company leases retail, distribution and office facilities, which expire at various dates through 2036. Future minimum rental payments under non-cancelable operating leases, as of July 2, 2016, are as follows: Fiscal Year Amount (millions) 2017 $268.2 2018 246.4 2019 223.4 2020 195.4 2021 164.4 Subsequent to 2021 611.4 Total minimum future rental payments $1,709.2 Assume that the appropriate discount rate for the operating leases is 5%. Use a financial calculator to determine the present value of the future minimum...
Case 13-1 Recording an Operating lease Noel Company leases 25 cell phones for three years. The...
Case 13-1 Recording an Operating lease Noel Company leases 25 cell phones for three years. The rent for the phones is $1,700 a month for 36 months ($61,200 in total). The fair value of the leased phones is $65,000. Noel’s has an 5.5% incremental borrowing rate and the PV of the lease payments is $56,557. Required: How would Noel have recorded this transaction under SFAS No. 13? How should Noel record this transaction under FASB ASC 842?
Coach Inc. reports the following in its 2015 Form 10-K. The Company leases retail, distribution and...
Coach Inc. reports the following in its 2015 Form 10-K. The Company leases retail, distribution and office facilities, which expire at various dates through 2036. Future minimum rental payments under non-cancelable operating leases, as of July 2, 2016, are as follows: Fiscal Year Amount (millions) 2017 $254.2 2018 232.4 2019 209.4 2020 181.4 2021 150.4 Subsequent to 2021 597.4 Total minimum future rental payments $1,625.2 Assume that the appropriate discount rate for the operating leases is 5%. Use a financial...
Which of the following items would require a lessor to classify a lease as an operating...
Which of the following items would require a lessor to classify a lease as an operating lease? A) The lease contains a bargain purchase option. B) Ownership of the property is transferred to the lessee during the lease term. C) The lease term is 80% of the estimated economic life of the leased property. D) The collectability of the minimum lease payments is highly uncertain. Triple Tango Track leases exercise equipment to its customers under direct-financing leases. Typically the equipment...
International Accounting Standards (IFRS) 16 Leases standardizes the accounting treatment and disclosure requirements of assets held...
International Accounting Standards (IFRS) 16 Leases standardizes the accounting treatment and disclosure requirements of assets held under lease. The approach to lessor accounting classifies leases into two types, Operating lease and Finance lease. Required: Discuss any five indications that may provide evidence that a particular lease agreement may be: An operating lease                                                                  A finance lease                                                                       Briefly explain the effect of treating a finance leased asset as though it was an operating leased asset on assets, liabilities, ROCE and Gearing ratios....
Analyzing, Interpreting and Capitalizing Operating Leases YUM! Brands, Inc., reports the following footnote relating to its...
Analyzing, Interpreting and Capitalizing Operating Leases YUM! Brands, Inc., reports the following footnote relating to its capital and operating leases in its 2015 10-K report ($ millions). Future minimum commitments under noncancelable leases are set forth below. At December 26, 2015, the present value of minimum payments under capital leases was $169 million. Commitments ($ millions) Capital Operating 2016 $20 $672 2017 20 620 2018 20 569 2019 20 516 2020 19 457 Thereafter 188 2,123 $287 $4,957 Using a...
Analyzing, Interpreting and Capitalizing Operating Leases Assume YUM! Brands, Inc., reports the following footnote relating to...
Analyzing, Interpreting and Capitalizing Operating Leases Assume YUM! Brands, Inc., reports the following footnote relating to its capital and operating leases in its 2010 10-K report ($ millions). Future minimum commitments...under non-cancelable leases are set forth below. At December 25, 2010, and December 26, 2009, the present value of minimum payments under capital leases was $236 million and $249 million, respectively. Commitments ($ millions) Capital Operating 2011 $ 26 $ 550 2012 63 514 2013 23 483 2014 23 447...
Assume Verizon Communications, Inc., provides the following footnote relating to its leasing activities in its 10-K...
Assume Verizon Communications, Inc., provides the following footnote relating to its leasing activities in its 10-K report. The aggregate minimum rental commitments under noncancelable leases for the periods shown at December 31, 2010, are as follows: Years (dollars in millions) Capital Leases Operating Leases 2011 $ 83 $ 1,449 2012 71 1,316 2013 67 1,056 2014 63 806 2015 46 527 Thereafter 161 1,937 Total minimum rental commitments 491 $ 7,091 Less interest and executory costs (89) Present value of...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT