Reference no: EM132622806

Problem 1: Which of the following statements characterizes an operating lease?

Option 1: The lessor derecognizes the asset from its books.

Option 2: The lessor registers a Lease Receivable on the date the contract begins.

Option 3: The lessor records a depreciation expense in the income statement.

Option 4: The lessor records an interest income in the Income Statement.

Problem 2: After the latest revision of the leasing standard in the United States, under the U.S. GAAP and IFRS, a lease is a finance lease if substantially all the risks and rewards of ownership are transferred to the lessee. In making this determination, more judgment and less specificity (fewer rules) is applied using

Option 1: U.S. GAAP

Option 2: IFRS

Option 3: Both U.S. GAAP and IFRS

Option 4: Neither nor U.S. GAAP or IFRS