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Lease Term - Clause with an Option to Terminate

Ssiwela14y ago
Example:- A lease contract is for 5 years. The lease contains a clause to terminate the lease 2 years before its initial end. The lessee is reasonably certain NOT to exercise this option. So what is the lease term?
stephenwidbergstephenwidbergTutor4y ago#1
i would assume 5 years. IFRS 16: The non-cancellable period for which a lessee has the right to use an underlying asset, plus: a) periods covered by an extension option if exercise of that option by the lessee is reasonably certain; and
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