A city enters into an 11 month lease with an option to renew the lease for additional
Question:
A city enters into an 11 month lease with an option to renew the lease for additional 11 months up to 5 times. In your opinion does the lease qualify for the one-year exception and thereby be accounted for as an operating rather than a capital lease? Would you response be different if shortly after the lease was entered into market conditions changed so that it was no longer in the city's economic interest to exercise the renewal option.
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The lease is clearly a capital lease Paragraph 16 of GASB Statement No 87 Leases de...View the full answer
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Related Book For 
Government And Not For Profit Accounting Concepts And Practices
ISBN: 9781119803898
9th Edition
Authors: Michael H. Granof, Saleha B. Khumawala, Thad D. Calabrese
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