22.214.171.124.1 1. Derecogn. asset; 2. Recogn. receivable
= Net investment (GI (Min. lease pmts +
unguarunteed RV) discounted @ interest
implicit in lease); 3. Initial direct cost incl.
in NI; 4. Recogn. finance income as per
effective interest rate method; 5. Lease
PMTS against GI
126.96.36.199.2 Remember manufacturer/dealer lessors
188.8.131.52.1 1. At inception of lease term recogn. an asset &
liability at LOWER of: -FV of leased asset;-PV of
min. lease pmts; 2. Apportion pmts between
finance cost & capital; 3. Initial direct cost incl.
in CA of asset; 4. Deprec. asset over shortest of
lease term/econimic life
1.2.2 Possible indicators: 1. Ownership
transferred at end of lease; 2.
Option to purchase; 3. PV of min.
lease pmts =/< FV of asset; 4.
2 Interest rate (Implicit rate) :
PV = Fair value of leased (Incl. Direct cost)
asset ; PMT = Installment; FV
= GRV +URV ; N = Lease term
3 Calc. PV of min. lease pmts:
PMT = Installment; FV =
GRV(Only); N = term; i = IIR;