10/10/23, 5:59 PM Solution Manual Intermediate Accounting 15th Kiesoch 21
CHAPTER21
Account
ingf
orLeases
ASSI
GNMENTCLASSI
FICATI
ONTABLE(
BYTOPI
C)
Br
ief Concept
s
Topi
cs Quest
ions Exer
cises Exer
cises Pr
obl
ems f
orAnalysi
s
*
1. Rat
ional
eforl
easi
ng. 1,2,4 1,2
*
2. Lessees;classi
ficat
ion 3,5,7, 1,2,3, 1,2,3, 1,2,3,4, 1,2,3,
ofleases;account
i
ngby 8,14 4,5 5,7,8, 6,7,8,9, 4,5,6
l
essees . 11,12, 11,12,14,
13,14 15,16
*
3. Di
scl
osur
eofl
eas
es. 19 2,4,5, 2,3,5
7,8
*
4. Lessors;cl
assificati
on 5,6,9,10, 6,7,8,11 4,5,6,7, 1,2,3,5, 2,4
ofleases;account
ingby 11,12,13 9,10,12, 10,16
l
essors. 13,14
*
5. Residualval
ues;bargai
n- 15,16, 9,10 4,8, 6,7,10, 5,6
purchaseopti
ons;ini
ti
al 17,18 9,10 11,13,
di
rectcosts. 14,15
*
6. Sal
e-l
easeback
. 20 12 15,16 7
*
Thi
smat
eri
ali
sdeal
twi
thi
nanAppendi
xtot
hechapt
er.
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right©2013J
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nter
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ateAcc
ount
ing,15/
e,Sol
uti
onsManual (
ForI
nst
ruct
orUs
eOnl
y) 21-
1
ASSI
GNMENTCLASSI
FICATI
ONTABLE(
BYLEARNI
NG OBJECTI
VE)
Quest
ions Pr
obl
ems Concept
s
Lear
ningObj
ect
ives Bri
ef Exer
cises f
or
Exerci
ses Anal
ysis
1. Explai
nthenature, 1,2
economicsubstance,and
advant
agesofleas e
tr
ansact
ions.
2. Desc
ribet
heaccount
i
ng 3,4,5,6 1,2,3,4 1,2,3, 1,3,4,6, CA21-
1,
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nter
medi
ateAcc
ount
ing,15/
e,Sol
uti
onsManual (
ForI
nst
ruct
orUs
eOnl
y) 21-
1
ASSI
GNMENTCLASSI
FICATI
ONTABLE(
BYLEARNI
NG OBJECTI
VE)
Quest
ions Pr
obl
ems Concept
s
Lear
ningObj
ect
ives Bri
ef Exer
cises f
or
Exerci
ses Anal
ysis
1. Explai
nthenature, 1,2
economicsubstance,and
advant
agesofleas e
tr
ansact
ions.
2. Describet
heaccounti
ng 3,4,5,6 1,2,3,4 1,2,3, 1,3,4,6, CA21-
1,
cri
ter
iaandprocedur
esfor 5,11 7,8,9, CA21-
2
capit
ali
zi
ngleasesbythe 11,12,
l
essee. 14,15,16
3. Contrasttheoperati
ng 7,8 5 5,12, 2,15 CA21-
3
andcapitali
zati
on 13,14
methodsofr ecordi
ng
l
eases .
4. Expl aintheadvantages 9 6,7,8 12,13,14 2,10,13, CA21-
4
andeconomi csofleasi
ng 16
toles sorsandidenti
fyt
he
classificat i
onsofleas
es
forthel essor
.
5. Descri
bethelessor’
s 10 6,7 4,10 5
account
ingf
ordirect
-
financingl
eases.
6. Identi
fyspeci
alf
eat
uresof 11,12,13 9,10 8,9 4,9,11,
l
eas earr
angementsthat 12
causeuniqueaccounti
ng
probl
ems.
7. Desc r
ibet heeffectof 14,15,16 9,10 3,8 6,10,11,
resi
dualv alues
, 13,14,
guaranteedand 15,16
unguaranteed,onl
ease
accounting.
8. Descri
bethelessor
’s 17,18 11 6,7,8,9 1,3,10, CA21-
5,
account
ingf
orsales-
type 13 CA21-
6
l
eases.
9. Li
stt
hediscl
osur
e 19 3,4,5,7, CA2-
12
r
equi
rementsf
orleases
. 8
*
10. Descri
bethelessee’s 20 12 15,16 CA21-
7
account
ingf
orsale-
l
easebacktr
ansactions.
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ateAcc
ount
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uti
onsManual (
ForI
nst
ruc
torUs
eOnl
y)
ASSI
GNMENTCHARACTERI
STI
CSTABLE
Levelof Time
I
tem Descript
ion Di
fficul ty(
mi nutes)
E21-1 Lesseeentri
es;capit
alleasewithunguar anteed Moderat
e 15–20
resi
dualval
ue.
E21-
2 Lesseecomput at
i
onsandent r
ies;capitall
ease Moderat
e 20–25
withguar
anteedresidualval
ue.
E21-
3 Lesseeentri
es;capit
alleasewithex ecutor
ycosts Moderat
e 20–30
andunguaranteedresidualval
ue.
E21-
4 Lessorentr
ies;di
rect-
financ i
ngl easewi t
hoptiont
opur
chas
e. Moder at
e 20–25
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nter
medi
ateAcc
ount
ing,15/
e,Sol
uti
onsManual (
ForI
nst
ruc
torUs
eOnl
y)
ASSI
GNMENTCHARACTERI
STI
CSTABLE
Levelof Time
I
tem Description Difficul t
y(mi nutes)
E21-1 Lesseeent ri
es;capi talleasewi thunguar ant eed Moderat
e 15–20
resi
dualv alue.
E21-
2 Lesseecomput at
ionsandent ri
es;capi tallease Moderat
e 20–25
withguar anteedr esidual value.
E21-
3 Lesseeent ri
es;capi talleasewi thex ecutorycost s Moderat
e 20–30
andunguar ant eedr esi dualv alue.
E21-
4 Lessorent ries;direct -financ ingl easewi thopt iontopur
chas
e. Moder ate 20–25
E21-
5 Typeofl eas e;amor t
izat i
onschedul e. Simple 15–20
E21-
6 Lessorent ries;sal es -t
ypel ease. Moderate 15–20
E21-
7 Lessee- l
ess orent ries ;s al
es- typel ease. Moderate 20–25
E21-
8 Lesseeent ri
eswi thbar gain-pur chas eopt i
on. Moderate 20–30
E21-
9 Lessorent rieswi thbar gain- pur chaseopt ion. Moderate 20–30
E21-
10 Comput at i
onofr ent al;journal entri
esf orless or. Moderate 15–25
E21-
11 Amor t
izations chedul eandj our nalentriesf orlessee. Moderate 20–30
E21-
12 Account i
ngf oranoper at i
ngl ease. Simple 10–20
E21-
13 Account i
ngf oranoper at i
ngl ease. Simple 15–20
E21-
14 Operatingl eas eforl es seeandl essor. Simple 15–20
*
E21-
15 Sale-l
eas eback . Moderate 20–30
*
E21-
16 Lessee-less or,sale- leas ebac k. Moderate 20–30
P21-
1 Lessee- l
essorent ri
es -sales-typel eas e. Si
mple 20–25
P21-
2 Lessee- l
essorent ri
es ;oper atingl ease. Si
mple 20–30
P21-
3 Lessee- l
essorent ri
es ;bal ancesheetpr esentati
on; Moder
ate 35–45
sal
es-typeleas e.
P21-
4 Balancesheetandi ncomes t
at ementdi sclos
ur e—lessee. Moder
ate 30–40
P21-
5 Balancesheetandi ncomes t
at ementdi sclos
ur e—lessor. Moder
ate 30–40
P21-
6 Lesseeent ri
eswi thr es i
dualv alue. Moder
ate 25–35
P21-
7 Lesseeent ri
esandbal anc esheetpr esentati
on,capitall
ease. Moder
ate 25–30
P21-
8 Lesseeent ri
esandbal anc esheetpr esentati
on,capitall
ease. Moder
ate 20–30
P21-
9 Lesseeent ri
es,capi talleasewi thmont hlypayment s. Moder
ate 20–30
P21-
10 Lessorcomput ati
onsandent ries,sales-typeleasewi th Compl
ex 30–40
unguaranteedr esidualv alue.
P21-
11 Lesseecomput ationsandent ri
es,capi t
alleas ewith Compl
ex 30–40
unguaranteedr esidualv alue.
P21-
12 Basiclesseeacc ountingwi thdi ffic ultPVcal cul
ati
on. Moder
ate 40–50
P21-
13 Lessorcomput ati
onsandent ries;sales-typeleasewi th Compl
ex 30–40
guaranteedr esidualv alue.
P21-
14 Lesseecomput ationsandent ri
es;capi t
alleasewi th Compl
ex 30–40
guaranteedr esidualv alue.
P21-
15 Operatingleas ev s.capi tallease. Moder
ate 30–40
P21-
16 Lessee- l
essoraccount ingf orr esidualvalues. Complex 30–40
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ount
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onsManual (
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nst
ruc
torUs
eOnl
y) 21-
3
ASSI
GNMENTCHARACTERI
STI
CSTABLE(
Cont
inued)
Levelof Time
I
tem Descript
ion Di
fficul t
y(mi nut
es)
CA21-
1 Lesseeac counti
ngandr eport
ing. Moderat
e 15–25
CA21-
2 Lessorandl esseeaccounti
nganddi scl
osure. Moderat
e 25–35
CA21-
3 Lesseecapi t
ali
zat
ioncri
teri
a. Moderat
e 20–30
CA21-
4 Compar i
sonofdi fferenttypesofaccount i
ngbyles
see Moderat
e 15–25
andlessor
.
CA21-
5 Lesseecapi t
ali
zat
ionofbargain-purchaseopti
on. Moder
ate 30–35
CA216 Leasecapi t
ali
zati
on bar
gainpur chaseoption Moder
ate 2025
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ount
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uti
onsManual (
ForI
nst
ruc
torUs
eOnl
y) 21-
3
ASSI
GNMENTCHARACTERI
STI
CSTABLE(
Cont
inued)
Levelof Time
I
tem Descript
ion Di
fficul t
y(mi nut
es)
CA21-
1 Lesseeac counti
ngandr eport
ing. Moderat
e 15–25
CA21-
2 Lessorandl esseeaccounti
nganddi scl
osure. Moderat
e 25–35
CA21-
3 Lesseecapi t
ali
zat
ioncri
teri
a. Moderat
e 20–30
CA21-
4 Compar i
sonofdi fferenttypesofaccount i
ngbyles
see Moderat
e 15–25
andlessor.
CA21-
5 Lesseecapi t
ali
zat
ionofbargain-purchaseopti
on. Moder
ate 30–35
CA21-
6 Leasecapi t
ali
zati
on,bar
gain-purchaseoption. Moder
ate 20–25
*
CA21-
7 Sale-
leaseback. Moder
ate 15–25
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SOLUTI
ONSTO CODI
FICATI
ONEXERCI
SES
CE21-
1
Mast
erGl
oss
ary
(
a) A bargai
n-purchaseoption i
sapr ovisi
onall
owingt helessee,athi
sopti
on,topur
chaset he
l
easedpropertyforapri
cethatissuffic i
ent
lylowerthantheexpect
edfai
rval
ueofthepropert
ya
thedatetheopti
onbecomesex erci
sablethatex
erciseoftheopti
onappear
s,atl
easei
ncept
ion,to
bereasonabl
yassured.
about:blank 4/105
CHAPTER21
Account
ingf
orLeases
ASSI
GNMENTCLASSI
FICATI
ONTABLE(
BYTOPI
C)
Br
ief Concept
s
Topi
cs Quest
ions Exer
cises Exer
cises Pr
obl
ems f
orAnalysi
s
*
1. Rat
ional
eforl
easi
ng. 1,2,4 1,2
*
2. Lessees;classi
ficat
ion 3,5,7, 1,2,3, 1,2,3, 1,2,3,4, 1,2,3,
ofleases;account
i
ngby 8,14 4,5 5,7,8, 6,7,8,9, 4,5,6
l
essees . 11,12, 11,12,14,
13,14 15,16
*
3. Di
scl
osur
eofl
eas
es. 19 2,4,5, 2,3,5
7,8
*
4. Lessors;cl
assificati
on 5,6,9,10, 6,7,8,11 4,5,6,7, 1,2,3,5, 2,4
ofleases;account
ingby 11,12,13 9,10,12, 10,16
l
essors. 13,14
*
5. Residualval
ues;bargai
n- 15,16, 9,10 4,8, 6,7,10, 5,6
purchaseopti
ons;ini
ti
al 17,18 9,10 11,13,
di
rectcosts. 14,15
*
6. Sal
e-l
easeback
. 20 12 15,16 7
*
Thi
smat
eri
ali
sdeal
twi
thi
nanAppendi
xtot
hechapt
er.
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right©2013J
ohnWi
l
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eso,I
nter
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ateAcc
ount
ing,15/
e,Sol
uti
onsManual (
ForI
nst
ruct
orUs
eOnl
y) 21-
1
ASSI
GNMENTCLASSI
FICATI
ONTABLE(
BYLEARNI
NG OBJECTI
VE)
Quest
ions Pr
obl
ems Concept
s
Lear
ningObj
ect
ives Bri
ef Exer
cises f
or
Exerci
ses Anal
ysis
1. Explai
nthenature, 1,2
economicsubstance,and
advant
agesofleas e
tr
ansact
ions.
2. Desc
ribet
heaccount
i
ng 3,4,5,6 1,2,3,4 1,2,3, 1,3,4,6, CA21-
1,
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nter
medi
ateAcc
ount
ing,15/
e,Sol
uti
onsManual (
ForI
nst
ruct
orUs
eOnl
y) 21-
1
ASSI
GNMENTCLASSI
FICATI
ONTABLE(
BYLEARNI
NG OBJECTI
VE)
Quest
ions Pr
obl
ems Concept
s
Lear
ningObj
ect
ives Bri
ef Exer
cises f
or
Exerci
ses Anal
ysis
1. Explai
nthenature, 1,2
economicsubstance,and
advant
agesofleas e
tr
ansact
ions.
2. Describet
heaccounti
ng 3,4,5,6 1,2,3,4 1,2,3, 1,3,4,6, CA21-
1,
cri
ter
iaandprocedur
esfor 5,11 7,8,9, CA21-
2
capit
ali
zi
ngleasesbythe 11,12,
l
essee. 14,15,16
3. Contrasttheoperati
ng 7,8 5 5,12, 2,15 CA21-
3
andcapitali
zati
on 13,14
methodsofr ecordi
ng
l
eases .
4. Expl aintheadvantages 9 6,7,8 12,13,14 2,10,13, CA21-
4
andeconomi csofleasi
ng 16
toles sorsandidenti
fyt
he
classificat i
onsofleas
es
forthel essor
.
5. Descri
bethelessor’
s 10 6,7 4,10 5
account
ingf
ordirect
-
financingl
eases.
6. Identi
fyspeci
alf
eat
uresof 11,12,13 9,10 8,9 4,9,11,
l
eas earr
angementsthat 12
causeuniqueaccounti
ng
probl
ems.
7. Desc r
ibet heeffectof 14,15,16 9,10 3,8 6,10,11,
resi
dualv alues
, 13,14,
guaranteedand 15,16
unguaranteed,onl
ease
accounting.
8. Descri
bethelessor
’s 17,18 11 6,7,8,9 1,3,10, CA21-
5,
account
ingf
orsales-
type 13 CA21-
6
l
eases.
9. Li
stt
hediscl
osur
e 19 3,4,5,7, CA2-
12
r
equi
rementsf
orleases
. 8
*
10. Descri
bethelessee’s 20 12 15,16 CA21-
7
account
ingf
orsale-
l
easebacktr
ansactions.
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2 Copy
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ohnWi
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nter
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ateAcc
ount
ing,15/
e,Sol
uti
onsManual (
ForI
nst
ruc
torUs
eOnl
y)
ASSI
GNMENTCHARACTERI
STI
CSTABLE
Levelof Time
I
tem Descript
ion Di
fficul ty(
mi nutes)
E21-1 Lesseeentri
es;capit
alleasewithunguar anteed Moderat
e 15–20
resi
dualval
ue.
E21-
2 Lesseecomput at
i
onsandent r
ies;capitall
ease Moderat
e 20–25
withguar
anteedresidualval
ue.
E21-
3 Lesseeentri
es;capit
alleasewithex ecutor
ycosts Moderat
e 20–30
andunguaranteedresidualval
ue.
E21-
4 Lessorentr
ies;di
rect-
financ i
ngl easewi t
hoptiont
opur
chas
e. Moder at
e 20–25
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2 Copy
right©2013J
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eso,I
nter
medi
ateAcc
ount
ing,15/
e,Sol
uti
onsManual (
ForI
nst
ruc
torUs
eOnl
y)
ASSI
GNMENTCHARACTERI
STI
CSTABLE
Levelof Time
I
tem Description Difficul t
y(mi nutes)
E21-1 Lesseeent ri
es;capi talleasewi thunguar ant eed Moderat
e 15–20
resi
dualv alue.
E21-
2 Lesseecomput at
ionsandent ri
es;capi tallease Moderat
e 20–25
withguar anteedr esidual value.
E21-
3 Lesseeent ri
es;capi talleasewi thex ecutorycost s Moderat
e 20–30
andunguar ant eedr esi dualv alue.
E21-
4 Lessorent ries;direct -financ ingl easewi thopt iontopur
chas
e. Moder ate 20–25
E21-
5 Typeofl eas e;amor t
izat i
onschedul e. Simple 15–20
E21-
6 Lessorent ries;sal es -t
ypel ease. Moderate 15–20
E21-
7 Lessee- l
ess orent ries ;s al
es- typel ease. Moderate 20–25
E21-
8 Lesseeent ri
eswi thbar gain-pur chas eopt i
on. Moderate 20–30
E21-
9 Lessorent rieswi thbar gain- pur chaseopt ion. Moderate 20–30
E21-
10 Comput at i
onofr ent al;journal entri
esf orless or. Moderate 15–25
E21-
11 Amor t
izations chedul eandj our nalentriesf orlessee. Moderate 20–30
E21-
12 Account i
ngf oranoper at i
ngl ease. Simple 10–20
E21-
13 Account i
ngf oranoper at i
ngl ease. Simple 15–20
E21-
14 Operatingl eas eforl es seeandl essor. Simple 15–20
*
E21-
15 Sale-l
eas eback . Moderate 20–30
*
E21-
16 Lessee-less or,sale- leas ebac k. Moderate 20–30
P21-
1 Lessee- l
essorent ri
es -sales-typel eas e. Si
mple 20–25
P21-
2 Lessee- l
essorent ri
es ;oper atingl ease. Si
mple 20–30
P21-
3 Lessee- l
essorent ri
es ;bal ancesheetpr esentati
on; Moder
ate 35–45
sal
es-typeleas e.
P21-
4 Balancesheetandi ncomes t
at ementdi sclos
ur e—lessee. Moder
ate 30–40
P21-
5 Balancesheetandi ncomes t
at ementdi sclos
ur e—lessor. Moder
ate 30–40
P21-
6 Lesseeent ri
eswi thr es i
dualv alue. Moder
ate 25–35
P21-
7 Lesseeent ri
esandbal anc esheetpr esentati
on,capitall
ease. Moder
ate 25–30
P21-
8 Lesseeent ri
esandbal anc esheetpr esentati
on,capitall
ease. Moder
ate 20–30
P21-
9 Lesseeent ri
es,capi talleasewi thmont hlypayment s. Moder
ate 20–30
P21-
10 Lessorcomput ati
onsandent ries,sales-typeleasewi th Compl
ex 30–40
unguaranteedr esidualv alue.
P21-
11 Lesseecomput ationsandent ri
es,capi t
alleas ewith Compl
ex 30–40
unguaranteedr esidualv alue.
P21-
12 Basiclesseeacc ountingwi thdi ffic ultPVcal cul
ati
on. Moder
ate 40–50
P21-
13 Lessorcomput ati
onsandent ries;sales-typeleasewi th Compl
ex 30–40
guaranteedr esidualv alue.
P21-
14 Lesseecomput ationsandent ri
es;capi t
alleasewi th Compl
ex 30–40
guaranteedr esidualv alue.
P21-
15 Operatingleas ev s.capi tallease. Moder
ate 30–40
P21-
16 Lessee- l
essoraccount ingf orr esidualvalues. Complex 30–40
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right©2013J
ohnWi
l
ey&Sons
,Inc
. Ki
eso,I
nter
medi
ateAcc
ount
ing,15/
e,Sol
uti
onsManual (
ForI
nst
ruc
torUs
eOnl
y) 21-
3
ASSI
GNMENTCHARACTERI
STI
CSTABLE(
Cont
inued)
Levelof Time
I
tem Descript
ion Di
fficul t
y(mi nut
es)
CA21-
1 Lesseeac counti
ngandr eport
ing. Moderat
e 15–25
CA21-
2 Lessorandl esseeaccounti
nganddi scl
osure. Moderat
e 25–35
CA21-
3 Lesseecapi t
ali
zat
ioncri
teri
a. Moderat
e 20–30
CA21-
4 Compar i
sonofdi fferenttypesofaccount i
ngbyles
see Moderat
e 15–25
andlessor
.
CA21-
5 Lesseecapi t
ali
zat
ionofbargain-purchaseopti
on. Moder
ate 30–35
CA216 Leasecapi t
ali
zati
on bar
gainpur chaseoption Moder
ate 2025
about:blank 3/105
, 10/10/23, 5:59 PM Solution Manual Intermediate Accounting 15th Kiesoch 21
Copy
right©2013J
ohnWi
l
ey&Sons
,Inc
. Ki
eso,I
nter
medi
ateAcc
ount
ing,15/
e,Sol
uti
onsManual (
ForI
nst
ruc
torUs
eOnl
y) 21-
3
ASSI
GNMENTCHARACTERI
STI
CSTABLE(
Cont
inued)
Levelof Time
I
tem Descript
ion Di
fficul t
y(mi nut
es)
CA21-
1 Lesseeac counti
ngandr eport
ing. Moderat
e 15–25
CA21-
2 Lessorandl esseeaccounti
nganddi scl
osure. Moderat
e 25–35
CA21-
3 Lesseecapi t
ali
zat
ioncri
teri
a. Moderat
e 20–30
CA21-
4 Compar i
sonofdi fferenttypesofaccount i
ngbyles
see Moderat
e 15–25
andlessor.
CA21-
5 Lesseecapi t
ali
zat
ionofbargain-purchaseopti
on. Moder
ate 30–35
CA21-
6 Leasecapi t
ali
zati
on,bar
gain-purchaseoption. Moder
ate 20–25
*
CA21-
7 Sale-
leaseback. Moder
ate 15–25
21-
4 Copy
right©2013J
ohnWi
l
ey&Sons,I
nc. Ki
eso,I
nter
medi
ateAcc
ount
ing,15/
e,Sol
uti
onsManual (
ForI
nst
ruc
torUs
eOnl
y)
SOLUTI
ONSTO CODI
FICATI
ONEXERCI
SES
CE21-
1
Mast
erGl
oss
ary
(
a) A bargai
n-purchaseoption i
sapr ovisi
onall
owingt helessee,athi
sopti
on,topur
chaset he
l
easedpropertyforapri
cethatissuffic i
ent
lylowerthantheexpect
edfai
rval
ueofthepropert
ya
thedatetheopti
onbecomesex erci
sablethatex
erciseoftheopti
onappear
s,atl
easei
ncept
ion,to
bereasonabl
yassured.
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