If, at the lease commencement date, it is likely that the lessee will exercise the purchase option, then the amount of the purchase option is included in the computation of the lease payments.

Question

Quizplus · Accepted Answer

If it is reasonably certain that the lessee will exercise the purchase option, the option's cost is included in the lease liability and right-of-use asset calculations as part of the lease payments.

If, at the Lease Commencement Date, It Is Likely That