• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
Free ACCA & CIMA online courses from OpenTuition

Free ACCA & CIMA online courses from OpenTuition

Free Notes, Lectures, Tests and Forums for ACCA and CIMA exams

  • ACCA
  • CIMA
  • FIA
  • OBU
  • Books
  • Forums
  • Search
  • Register
  • Login
  • ACCA Forums
  • Ask ACCA Tutor
  • CIMA Forums
  • Ask CIMA Tutor
  • FIA
  • OBU
  • Buy/Sell Books
  • All Forums
  • Latest Topics

Congratulations to Jamil from Pakistan and Jeeva from Malaysia - Global Prize winners!
see all ACCA December 2022 Genius Hunt Competition winners >>

Specially for OpenTuition students: 20% off BPP Books for ACCA & CIMA exams – Get your BPP Discount Code >>

Leases Example 1

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Leases Example 1

  • This topic has 1 reply, 2 voices, and was last updated 8 months ago by P2-D2.
Viewing 2 posts - 1 through 2 (of 2 total)
  • Author
    Posts
  • June 3, 2022 at 7:45 am #657191
    Hussain
    Member
    • Topics: 24
    • Replies: 25
    • ☆

    Hello Sir….
    Question No 1
    Can you please tell me that why do we put the initial value of lease in Year 1 at its Present value??? Whats the reason of doing it???

    Question No 2
    Also whats the point of doing it when we have to reverse that discounting using Amortised Cost model???

    June 4, 2022 at 9:36 am #657337
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 6453
    • ☆☆☆☆☆

    Hi,

    Question No.1 – this is an application of the rules in the accounting standard and is looking at the amounts we are obliged to pay over the lease period

    Question No.2 – the amortised cost treatment is reflecting the payment of the lease and accruing the interest on the lease. As the lease evolves each year, the value of the liability reduces as we owe less. It also highlights that we accrue less interest each year as the liability falls, a great example of the matching concept.

    Thanks

  • Author
    Posts
Viewing 2 posts - 1 through 2 (of 2 total)
  • You must be logged in to reply to this topic.
Log In

Primary Sidebar

ACCA News:

 

ACCA My Exam Performance for non-variant Applied Skills exams is available NOW

NEW! Download the ACCA Pass Guide

FREE Verifiable CPD for ACCA Members

ACCA mock exams and debrief videos

ACCA Options:  “Read the Mind of the Marker” articles

Subscribe to ACCA’s Student Accountant Direct

Donate

If you have benefited from OpenTuition please donate.

ACCA CBE 2023 Exams

Instant Poll * How was your exam, and what was the result?

BT CBE exam was.. | MA CBE exam was..
FA CBE exam was.. | LW CBE exam was..

Specially for OpenTuition students

20% off BPP Books

Get BPP Discount Code

Latest comments

  • douglasnyangara on Foreign exchange risk management (1) Part 4 – ACCA (AFM) lectures
  • douglasnyangara on Foreign exchange risk management (1) Part 4 – ACCA (AFM) lectures
  • AnnaTeddy on Basic group structures – SPLOCI introduction and example – ACCA (SBR) lectures
  • tanyanti on Conceptual Framework – ACCA SBR lecture
  • John Moffat on Statement of Cash Flows (part b) Example 1 – ACCA Financial Accounting (FA) lectures

Copyright © 2023 · Support · Contact · Advertising · OpenLicense · About · Sitemap · Comments · Log in


We use cookies to show you relevant advertising, find out more: Privacy Policy · Cookie Policy