Lessee leased some land and buildings from Lessor.There was no transfer of ownership and no bargain purchase option.If the fair value of the land is less than a certain percentage of the total fair value of the leased property at the inception of the lease, both the lessee and the lessor may consider the land and buildings as a single unit.What is that percentage?
A)10%
B)20%
C)25%
D)50%

Question

Quizplus · Accepted Answer

If the fair value of the land is less than 25% of the total fair value of the leased property, the land and buildings can be considered as a single unit.

Lessee Leased Some Land and Buildings from Lessor