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Basic Question 9 of 15
Under IFRS, how are initial direct costs incurred by a lessor in negotiating a sales-type lease treated?
B. They are deferred and expensed over the lease term on a straight-line basis.
C. They are debited to unearned interest revenue in the first period of the lease term.
A. They are expensed in the first period of the lease term.
B. They are deferred and expensed over the lease term on a straight-line basis.
C. They are debited to unearned interest revenue in the first period of the lease term.
User Contributed Comments 3
| User | Comment |
|---|---|
| johntan1979 | Is it different under GAAP? |
| robbiecow | Yup, for sales-type leases initial direct costs are expensed at the inception of the lease |
| robbiecow | Meant Yup, it is the same. |
I am using your study notes and I know of at least 5 other friends of mine who used it and passed the exam last Dec. Keep up your great work!
Barnes
Learning Outcome Statements
explain the financial reporting of leases from the perspectives of lessors and lessees
CFA® 2025 Level I Curriculum, Volume 2, Module 8.