IAS 17 deems cancellable leases with which of the following characteristics to be non-cancellable:

A) I
B) II
C) III
D) IV.

Question

IAS 17 deems cancellable leases with which of the following characteristics to be non-cancellable:

A) I 
B) II 
C) III 
D) IV.

Quizplus · Accepted Answer

According to IAS 17, a lease agreement will be deemed non-cancellable only if it contains an obligation for the lessee to pay the lease payments for the entirety of the lease term, with no option to terminate the lease prematurely. Therefore, only Option III meets this criterion. Option I has a fixed term but may still be cancelled if certain conditions are met. Option II does not have a fixed term and can be cancelled by either party with notice. Option IV has a fixed term but allows the lessee to cancel prematurely, making it cancellable.

IAS 17 Deems Cancellable Leases with Which of the Following