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Lessee leases copy machine from Lessor. Lessor agrees to provide all maintenance service. Lease payment is $1000 per month. Maintenance service has FMV of $200/month. What are the lease components within this contract? What amount of lease payment will be used in measuring the lease liability/payable by Lessee/Lessor?

How will the Lessee and Lessor account for initial direct costs?

At what amount does a Lessee measure the Lease liability in a Financing lease? Operating lease?

At what amount does a Lessee measure a Right of Use Asset in a Financing lease? Operating lease?

Over what period does a Lessee amortize the Right of Use Asset in a Financing lease? Operating lease?

How does the Lessees amortization of Right of Use Asset differ between Financing lease and Operating lease?

How does Lessee report the amortization and interest components of lease expense on the income statement under an Operating Lease?

How does the Lessors discount rate differ when initial direct costs are capitalized versus when they are not capitalized?

At what amount does a Lessor measure the Investment in Lease asset account in a Sales lease? Direct Financing lease?

Does a Lessor recognize profit in a Direct Financing Lease?

In a Sales lease in which the leased asset cost differs from market value at lease inception, how much sales revenue does the Lessor recognize? How much cost of sales does the Lessor recognize?

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