Which of the following is not a condition under which the lessee must record the lease of an asset?
A) The lease contains a bargain purchase option.
B) The lease transfers ownership of the property to the lessee.
C) The lease term is equal to 60% of the economic life of the lease property.
D) The present value of the lease payments is 90% of the fair value of the leased property.

Question

Quizplus · Accepted Answer

According to ASC 842, a lessee must record the lease of an asset if the lease transfers control of the asset to the lessee, the lease term is for a major part of the asset's economic life, the lease contains a bargain purchase option, or the present value of the lease payments is substantially all of the fair value of the asset. A lease term equal to 60% of the economic life of the asset is not a condition for recording the lease. The lessee must record the lease of an asset if any of the following conditions are met: 
A) The lease contains a bargain purchase option.
B) The lease transfers ownership of the property to the lessee.
D) The present value of the lease payments is 90% of the fair value of the leased property. 
Condition C is not one of the criteria that require the lessee to record the lease of an asset.

Which of the Following Is Not a Condition Under Which