Under the provisions of ASU 2016-02,which of the following is not required in a lease modification when the lease payments re required to be remeasured?
A)Any variable lease payments that are based on a rate or index will need to be remeasured.
B)The total lease liability is remeasured
C)The remeasured lease must be subsequently recorded as an operating lease
D)The lessee is generally required to use an updated discount rate.

Question

Quizplus · Accepted Answer

Under the provisions of ASU 2016-02, a lease modification that requires the lease payments to be remeasured must include the remeasurement of the total lease liability and any variable lease payments that are based on a rate or index. Additionally, the lessee is generally required to use an updated discount rate. However, the remeasured lease does not necessarily need to be subsequently recorded as an operating lease. The classification of the lease (i.e. operating or finance) will depend on whether the modification results in a new lease contract or a change to the existing lease contract.

Under the Provisions of ASU 2016-02,which of the Following Is