ACC 577 OUTLET Great Stories /acc577outlet.com ACC 577 OUTLET Great Stories /acc577outlet.com | Page 64

When should a lessor recognize in income a nonrefundable lease
bonus paid by a lessee on signing an operating lease?
Question 5
In a sale-leaseback transaction, a gain resulting from the sale
should be deferred at the time of the sale-leaseback and
subsequently amortized when . I. The seller-lessee has transferred
substantially all the risks of ownership. II. The seller-lessee
retains the right to substantially all of the remaining use of the
property.
Question 6
The following information pertains to a sale and leaseback of
equipment by Mega Co. on December 31, 2005: What amount of
deferred gain on the sale should Mega report at December 31,
2005?
Question 7
On August 1, 2005, Metro, Inc. leased a luxury apartment unit to
Klum. The parties signed a 1-year lease beginning September 1,
2005 for a $1,000 monthly rent payable on the first day of the
month. At the August 1 signing date, Metro collected $540 as a
nonrefundable fee for allowing Klum to sign a 1-year lease (the
normal lease term is three years) and $1,