For the lessor, under a sales-type lease, the excess of the normal sales price (i.e., current market)of the leased asset over its cost (or carrying amount)should be recognized as revenue by the lessor:

Question

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In a sales-type lease, the lessor recognizes the excess of the normal sales price over the cost or carrying amount of the leased asset as revenue in full at the inception date of the lease. This is because the lease is considered to have been "sold" at the beginning of the lease term, transferring the risks and rewards of ownership to the lessee.

For the Lessor, Under a Sales-Type Lease, the Excess of the Normal