If a company made the following entry: $\begin{array} { l }
\text {Dr. Asset under lease (A) }&xx\ \text {$ \mathrm{Cr} $. Lease obligation (L) }&&xx\
\end{array}$

Under IFRS, what type of lease do they have?
A)Capital lease
B)Finance lease
C)Operating lease
D)Sales-type lease

Question

If a company made the following entry: $\begin{array} { l  }
 \text {Dr. Asset under lease (A) }&xx\ \text {$ \mathrm{Cr} $. Lease obligation (L) }&&xx\
\end{array}$

Under IFRS, what type of lease do they have?
A)Capital lease
B)Finance lease
C)Operating lease
D)Sales-type lease

Quizplus · Accepted Answer

Under IFRS, a lease that results in the recognition of an asset and a liability on the balance sheet is referred to as a finance lease. This is indicated by the debit to an asset account and the credit to a lease obligation account.

If a Company Made the Following Entry Dr. Asset under lease (A) xxCr. Lease obligation (L) xx\begin{array} { l } \text {Dr. Asset under lease (A) }&xx\\ \text {\( \mathrm{Cr} \). Lease obligation (L) }&&xx\\\end{array}Dr. Asset under lease (A) Cr. Lease obligation (L) ​xx​xx​

If a Company Made the Following Entry $\begin{array} { l } \text {Dr. Asset under lease (A) }&xx\\ \text {\( \mathrm{Cr} \). Lease obligation (L) }&&xx\\\end{array}$