Where a lessor is involved in a finance lease (risk has passed to the lessee) the lessor must:
A) remove the asset in question from their statement of financial position as they no longer own it.
B) record a new asset on their statement of financial position, a lease receivable, to replace the leased asset.
C) only record the revenue earned from lease payments in the statement of comprehensive income as they are received.
D) record the sale of the asset to the lessee to ensure the accounting records accurately reflect control of the leased asset.
Correct Answer:
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