A leased asset under capital lease is disclosed on the balance sheet at its
A)present value
B)historical cost
C)current cost
D)net realizable value

Question

Quizplus · Accepted Answer

A leased asset under capital lease is recognized on the balance sheet at its present value, which is the fair value of the asset or the total of the minimum lease payments, whichever is lower. This is because the lessee is essentially purchasing the leased asset through the lease payments and is thus recognizing it on their balance sheet as an asset.

A Leased Asset Under Capital Lease Is Disclosed on the Balance