alleryStart learning →In a finance leaseback, the carrying amount is written down only if there is
AAn impairment in value
BA drop in market rentals
CA change in lease term
DA loss on the sale
Answer & Solution
Correct answer: A. An impairment in value
Finance leasebacks need no fair value adjustment unless the asset is impaired, then it goes to recoverable amount.
Keep practising AS 19 Leases
Browse all AS 19 Leases questions for CA Inter, or explore more Accounting topics.
Related questions
Leaving a finance lease off the lessee's balance sheet understates obligations and distortFor a lessee, the amount of a residual value guarantee is theA lessor on finance leases also discloses accumulated provision forWhich must a lessor disclose for finance leases?Leaseback below fair value, loss offset by cheap rentals, isAsset sold at fair value Rs 6 lakh, carrying amount Rs 8 lakh, operating leaseback. Loss rOperating leaseback above fair value: the excess isAn operating leaseback at fair value gives a profit that is