alleryStart learning →Implicit rate equates payments plus residual to fair value plus:
Alessor's initial direct costs
Bresidual guarantee receipts
Clessee's initial costs
Dlessor's finance charges
Answer & Solution
Correct answer: A. lessor's initial direct costs
The definition sets the discounted inflows equal to fair value of the asset plus the lessor's initial direct costs.
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: