Initial Measurement of a Lease Liability
Measure an initial lease liability by selecting lease payments and discounting them at the appropriate rate.
Measure the initial liability for a three-year equipment lease with USD 60,000 fixed monthly payments, USD 4,000 monthly maintenance, a USD 30,000 residual guarantee expected to be paid, and an unsupported optional extension. Select lease payments first; discount only the cash flows that belong in the liability. The common shortcut is to discount the total invoice because the vendor bills one amount. That overstates the liability when services are separate and may still miss guarantees or option payments. Step 1 Separate the monthly invoice: USD 60,000 fixed equipment use is a lease payment; USD 4,000 maintenance is a nonlease service…
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