alleryStart learning →The initial lease liability is measured at:
Athe total undiscounted rentals
Bthe present value of year-one rent
Cthe fair value of the leased asset
Dpresent value of unpaid lease payments
Answer & Solution
Correct answer: D. present value of unpaid lease payments
The liability is the discounted value of payments that remain unpaid at the commencement date.
Keep practising Ind AS 116 Leases
Browse all Ind AS 116 Leases questions for CA Final, or explore more Financialreporting topics.
Related questions
Ind AS 116 applies to annual reporting periods beginning on or after:At transition, a practical expedient lets an entity avoid reassessing:Modified retrospective adoption: the cumulative effect goes to:Asset worth Rs 5,00,000 sold for Rs 4,60,000 in leaseback at market rent. Rs 40,000 shortfSame sale-leaseback: total gain is Rs 2,00,000 and the retained right is 25% of fair valueSale-leaseback: carrying Rs 4,00,000; fair value Rs 6,00,000; PV of market lease payments A sale and leaseback transfer fails the sale test. The seller-lessee:In a sale and leaseback, whether the transfer is a sale is decided using: