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LEASE - Coggle Diagram

- - - - #2: PV(LPs) = Lease payable/liability
        
        #3: LPs - PV(LPs) = Interest to be amortized
        
        #4: Depreciation of leased asset
        
        Depreciation
        
        Transfer of ownership
        
        Useful life
        
        No transfer of ownership
        
        Shorter of lease term/useful life
        
        @ Implicit rate, if unknown then lessee's borrowing rate
        
        ROU asset = PV(LPs) + Initial Direct Costs + Pmts before commencement date + Prov. for dismantling & restoration costs
      - LPs = n(ALP) + BPO / TO / EPGRV
    - - (1) ST lease (<= 12 mths), without BPO
        
        Dr Lease rental exp Cr Cash
      - (2) Low value lease (5k threshold, e.g. office equip/furniture - based on cost of asset)