Corporate Accounting and Reporting: Financial Lease for Dealers
VerifiedAdded on 2023/06/04
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This report provides a detailed overview of financial lease accounting for dealers and manufacturers under AASB 117. It covers the initial recognition of financial leases, where the lessor recognizes the transaction as a sale and records a lease receivable, and the subsequent measurement, which involves recognizing finance income over the lease term. The report also discusses the treatment of unguaranteed residual values and initial direct costs. Furthermore, it outlines the required disclosures, including unearned finance income, unguaranteed residual values, and a reconciliation of gross investment in the lease. The document references Australian Accounting Standard Board guidelines and provides relevant journal entries for both the lessor and lessee, offering a comprehensive understanding of the accounting procedures and reporting requirements for financial leases.
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