alleryStart learning →For a lessee, the amount of a residual value guarantee is the
AAverage expected amount payable
BSalvage value estimated by lessor
CMaximum amount that could be payable
DFair value at lease inception
Answer & Solution
Correct answer: C. Maximum amount that could be payable
The guarantee is measured at the maximum amount that could in any event become payable.
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 distortA lessor on finance leases also discloses accumulated provision forWhich must a lessor disclose for finance leases?In a finance leaseback, the carrying amount is written down only if there isLeaseback 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