- This topic has 1 reply, 2 voices, and was last updated 11 years ago by
.
Viewing 2 posts - 1 through 2 (of 2 total)
- Posts
When finding the LOWER of fair value and minimum lease payments ,do we also consider the initial payment/deposit as lease payments or do we just see what the total lease payments will be excluding the initial one?
If you think about this for just a brief moment …… you will realise that minimum lease payments (the minimum amount payable under the lease contract) must include the first payment – known in the UK as a “deposit” (but that causes some confusion in some parts of the World where the word “deposit” implies an amount which is eligible to be refunded at the end of the contract)
In ACCA exams and lease questions, the word deposit means an initial payment made in part settlement of the overall capital amount owing under the lease
Viewing 2 posts - 1 through 2 (of 2 total)
- You must be logged in to reply to this topic.