An analyst has decided to capitalize the operating leases of Company A. Using information in
the notes to the company’s 2015 financial statements, she has determined that the present value
of future minimum lease payments, at a discount rate of 10 percent, on December 31, 2015
equals €500 million. All lease contracts last another 5 years on December 31, 2015. As expected
at the beginning of the year, the company reports an operating lease expense in its income
statement for 2016 of €80 million. The company’s tax rate equals 30 percent. The company does
not engage in any new operating leases in 2016. The following information is also available from
Company A’s financial statements (all ratios use beginning-of-the-year balance sheet values)
Debt to capital (at beginning of 2016) = 0.55
Return on beginning equity in 2016 = 0.10
Assets / Capital (at beginning of 2016) = €3,400 million
The effect of capitalizing Company A’s operating leases on its return on beginning equity equals
A. An increase from 0.10 to 0.15 (rounded).
B. An increase from 0.10 to 0.13 (rounded).
C. A decrease from 0.10 to 0.07 (rounded).
D. A decrease from 0.10 to 0.05 (rounded).
Solution
accounting topic of leases is a popular Paper F7 exam area that could feature to varying degrees
in Questions 2, 3, 4 or 5 of the exam. This topic area is currently covered by IAS 17, Leases. IAS
17, Leases takes the concept of substance over form and applies it to the specific accounting area
of leases.
When applying this concept, it is often deemed necessary to account for the substance of a
transaction – ie its commercial reality, rather than its strict legal form. In other words, the legal
basis of a transaction can be used to hide the true nature of a transaction. It is argued that by
applying substance, the financial statements become more reliable and ensure that the lease is
faithfully represented.
WHY DO WE NEED TO APPLY SUBSTANCE TO A LEASE?
A lease agreement is a contract between two parties, the lessor and the lessee. The lessor is the
legal owner of the asset, the lessee obtains the right to use the asset in return for rental payments.
Historically, assets that were used but not owned were not shown on the statement of financial
position and therefore any associated liability was also left out of the statement – this was known
as ‘off balance sheet’ finance and was a way that companies were able to keep their liabilities
low, thus distorting gearing and other key financial ratios. This form of accounting did not
faithfully represent the transaction. In reality a company often effectively ‘owned’ these assets
and ‘owed a liability’.
Under modern day accounting the IASB framework states that an asset is ‘a resource controlled
by an entity as a result of past events and from which future economic benefits are expected to
flow to the entity’ and a liability is ‘a present obligation of the entity arising from past events, the
settlement of which is expected to result in an outflow fr.
In order to inform you of the upcoming changes in lease accounting and the impact on IFRS reporting for fleets, LeasePlan’s Head of Consultancy Matthew Walters answers the most important questions on this topic in the below Q&A.
416Business firms generally acquire property rights in lon.docxgilbertkpeters11344
416
Business firms generally acquire property rights in long-term assets through
purchases that are funded by internal sources or by externally borrowed
funds. The accounting issues associated with the purchase of long-term
assets were discussed in Chapter 9. Leasing is an alternative means of
acquiring long-term assets to be used by business firms. Leases that are not
in-substance purchases provide for the right to use property by lessees, in
contrast to purchases that transfer property rights to the user of the long-
term asset. Lease terms generally obligate lessees to make a series of pay-
ments over a future period. As such, they are similar to long-term debt.
However, if a lease is structured in a certain way, it enables the lessee to
engage in off–balance sheet financing (discussed in Chapter 11) because cer-
tain leases are not recorded as long-term debt on the balance sheet. Busi-
ness managers frequently wish to use off–balance sheet financing in order
to improve the financial position of their companies. However, as noted
earlier in the text, efficient market research indicates that off–balance sheet
financing techniques are incorporated into user decision models in deter-
mining the value of a company.
Leasing has become a popular method of acquiring property because it
has the following advantages.
1. It offers 100 percent financing.
2. It offers protection against obsolescence.
3. It is frequently less costly than other forms of financing the cost of the
acquisition of fixed assets.
4. If the lease qualifies as an operating lease, it does not add debt to the
balance sheet.
CHAPTER
13
Leases
Introduction 417
Many long-term leases possess most of the attributes of long-term debt.
That is, they create an obligation for payment under an agreement that is
noncancelable. The adverse effects of debt are also present in leases in that
an inability to pay may result in insolvency. Consequently, even though
there are statutory limitations on lease obligations in bankruptcy proceed-
ings, these limits do not affect the probability of the adverse effects of non-
payment on asset values and credit standing in the event of nonpayment of
lease obligations. The statutory limitations involve only the evaluation of the
amount owed after insolvency proceedings have commenced.
Management’s choice between purchasing and leasing is a function of
strategic investment and capital structure objectives, the comparative costs of
purchases of assets versus leasing assets, the availability of tax benefits, and per-
ceived financial reporting advantages. The tax benefit advantage is a major fac-
tor in leasing decisions. From a macroeconomic standpoint, the tax benefits of
owning assets may be maximized by transferring them to the party in the higher
marginal tax bracket. Firms with lower effective tax rates may engage in more
leasing transactions than firms in higher tax brackets since the tax benefits are
passed on to the lessor. El-Gazzar et .
In order to inform you of the upcoming changes in lease accounting and the impact on IFRS reporting for fleets, LeasePlan’s Head of Consultancy Matthew Walters answers the most important questions on this topic in the below Q&A.
416Business firms generally acquire property rights in lon.docxgilbertkpeters11344
416
Business firms generally acquire property rights in long-term assets through
purchases that are funded by internal sources or by externally borrowed
funds. The accounting issues associated with the purchase of long-term
assets were discussed in Chapter 9. Leasing is an alternative means of
acquiring long-term assets to be used by business firms. Leases that are not
in-substance purchases provide for the right to use property by lessees, in
contrast to purchases that transfer property rights to the user of the long-
term asset. Lease terms generally obligate lessees to make a series of pay-
ments over a future period. As such, they are similar to long-term debt.
However, if a lease is structured in a certain way, it enables the lessee to
engage in off–balance sheet financing (discussed in Chapter 11) because cer-
tain leases are not recorded as long-term debt on the balance sheet. Busi-
ness managers frequently wish to use off–balance sheet financing in order
to improve the financial position of their companies. However, as noted
earlier in the text, efficient market research indicates that off–balance sheet
financing techniques are incorporated into user decision models in deter-
mining the value of a company.
Leasing has become a popular method of acquiring property because it
has the following advantages.
1. It offers 100 percent financing.
2. It offers protection against obsolescence.
3. It is frequently less costly than other forms of financing the cost of the
acquisition of fixed assets.
4. If the lease qualifies as an operating lease, it does not add debt to the
balance sheet.
CHAPTER
13
Leases
Introduction 417
Many long-term leases possess most of the attributes of long-term debt.
That is, they create an obligation for payment under an agreement that is
noncancelable. The adverse effects of debt are also present in leases in that
an inability to pay may result in insolvency. Consequently, even though
there are statutory limitations on lease obligations in bankruptcy proceed-
ings, these limits do not affect the probability of the adverse effects of non-
payment on asset values and credit standing in the event of nonpayment of
lease obligations. The statutory limitations involve only the evaluation of the
amount owed after insolvency proceedings have commenced.
Management’s choice between purchasing and leasing is a function of
strategic investment and capital structure objectives, the comparative costs of
purchases of assets versus leasing assets, the availability of tax benefits, and per-
ceived financial reporting advantages. The tax benefit advantage is a major fac-
tor in leasing decisions. From a macroeconomic standpoint, the tax benefits of
owning assets may be maximized by transferring them to the party in the higher
marginal tax bracket. Firms with lower effective tax rates may engage in more
leasing transactions than firms in higher tax brackets since the tax benefits are
passed on to the lessor. El-Gazzar et .
Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...ssuserf63bd7
name:test bank for Intermediate Accounting, Volume 2, 13th Canadian Edition Donald E. Kieso
Edition:Volume 2, 13th Canadian Edition
author:Donald E. Kieso
ISBN:9781119780311
type:Test bank
format:word/zip
All chapter include
https://qidiantiku.com/test-bank-for-intermediate-accounting-volume-2-13th-canadian-edition-by-donald-e-kieso.shtml
Intermediate Accounting Volume 2 Canadian 11th Edition Kieso Test BankBentonner
Full download : https://alibabadownload.com/product/intermediate-accounting-volume-2-canadian-11th-edition-kieso-test-bank/ Intermediate Accounting Volume 2 Canadian 11th Edition Kieso Test Bank
Contingent liabilities, commitments and provisions in oil industryHamdy Rashed
What is the different between contingency, commitment and provision, how disclose the Joint venture minimum exploration payment or obligation in the financial statements
Accounting services overview of insurance contract under ifrsAhmedTalaat127
The majority of accounting services in Dubai and UAE ignore insurance accounting because they are not in the insurance business. Now that there will be a new accounting standard related to insurance contracts, chartered accountants should check to make sure they aren’t erroneously issuing them.
McKonly & Asbury’s April webinar entitled, “Leasing: A New Standard is Finally Here” is hosted by Dan Sturm, Partner; Brett Bauer, Senior Manager; and Tim Showers, Supervisor. During this webinar, attendees will learn how ASC 842 differs from ASC 840; will see illustrative financial statements which highlight exactly what changes as a result of the new standard; and will gain an understanding of what they should be doing now to prepare.
Topic: Income Tax and Leases
Type: CourseWork
Subject: Accounting and Finance
Academic Level: Undergraduate
Style: MLA
Language: English (U.S)
Number of Pages: 3 (double-spaced, Times New Roman, Font 12)
Number of sources: 1
Task Details :
There are three general views regarding inter period income tax allocation: no allocation, partial allocation, and comprehensive allocation. Required: a. Defend the position of no allocation of income taxes. b. Defend the position of partial allocation of income taxes. c. Defend the position of comprehensive allocation of income taxes. Capital leases and operating leases are the two classifications of leases described in FASB pronouncements from the standpoint of the lessee.
Required:
a. Describe how a capital lease would be accounted for by the lessee both at the inception of the lease and during the first year of the lease, assuming the lease transfers ownership of the property to the lessee by the end of the lease.
b. Describe how an operating lease would be accounted for by the lessee both at the inception of the lease and during the first year of the lease, assuming the lessee makes equal monthly payments at the beginning of each month of the lease.
c. Describe Direct Financing and Capital Contracts
Finvision impact series 1 - ed leases - lessee accountingFinvision
IFRS accounting - Exposure draft on lease accounting has been released recently. The presentation gives an brief overview on the basic principles and how it may impact your organization
Lease Accounting Methodology: A Theoretical Reflectioniosrjce
The purpose of this paper is to examine lease accounting methods and x-ray how they influence a
choice of lease arrangements. Requirements of International Accounting Standards (IAS) 17 were considered
including theoretical framework on the various dimensions of leasing. From archival data, preference is given
to operating leases as an off-statement of financial position financing. It also possesses few bottlenecks than
finance leases in terms of compliance with accounting requirements. Consequently, it is essential to take
cognisance of the complexities inherent in the respective lease options before deciding on which one to
undertake. Moreover, the need to be computer literate as a result of growing trends in information and
communication technology (ICT) is vital because most leasing arrangements presently, are perfected using
sophisticated software
H&M The Challenges of Global Expansion and the Move to adopt Intern.pdffazanmobiles
H&M: The Challenges of Global Expansion and the Move to adopt International Financial
Reporting standards Hennes & Mauritz AB (also known as H&M) , the Swedish MNE that is a
trendsetter in the latest fashion trends, has a stated goal “to give customers unbeatable value by
offering fashion and quality at the best price.” It doesn’t own any factories, but rather outsources
production to independent suppliers, primarily in Asia and Europe. H&M also rents space from
international and local landlords rather than owning its own stores. H&M is a major firm in the
apparel retail market where fashion trends are critical and where goods move quickly. In this
industry, the key buyers are consumers, and the key suppliers are clothing manufacturers and
wholesalers, and designers are king and a fast, well-organized supply chain is essential.
Depending on the individual firm strategy, the apparel retail market doesn’t have to be capital
intensive, but the largest players in the industry are very international, both in retail footprint and
suppliers. The biggest companies in the industry are U.S.-based The Gap, H&M, and Spain-
based Industria de Diseno Textil, S.A. (Inditex), better known by its flagship brand, Zara. All
three companies have different store brands: Gap, Banana Republic, Old Navy, and Athleta for
The Gap; H&M, COS (collection of style), Monki, Weekday, and Cheap Monday for H&M; and
Zara, Bershka, Pull and bear, Massimo Dutti, Stradivarius, Oysho, Zara Home and Uterque for
Inditex. Both of H&M’s competitors are very international. H&M operates about 2,800 stores in
49 markets, whereas The Gap operates 3,100 company stores and over 300 franchise stores
worldwide, and Inditex operates in a network of over 5,000 stores in 77 countries. Zara has the
largest geographic spread within Inditex with stores in 74 countries. Hennes & Mauritz AB
started as a single women’s wear store in Sweden in 1947. Today, H&M’s business is much
broader and currently includes the sales of clothing, accessories, footwear, cosmetics, and home
textiles. Although H&M is known as one of Sweden’s premier MNEs, it generates 21.5% of its
sales in Germany, 8.9% in the United States, and 7.4% in the United Kingdom, compared to only
5.8% of total sales in Sweden. H&M and Zara have very different strategies. Zara delivers new
products to its stores twice a week. Because of its highly organized supply chain, Zara only takes
10–15 days to go from design to the stores. Although it sources its apparel from around the
world, it has adopted just-in-time manufacturing from the auto industry and established 14 highly
automated Spanish factories where robots cut and dye fabrics creating the unfinished “gray
goods” which are the foundation for their final products. It then takes the gray goods and
outsources them to a network of small shops in Portugal and Spain to do the finish work. Store
managers are constantly sending updated information on consumer demand so that they can
move to the n.
C++ ProgrammingYou are to develop a program to read Baseball playe.pdffazanmobiles
C++ Programming
You are to develop a program to read Baseball player statistics from an input file. Each player
should bestored in a Player object. Therefore, you need to reuse the Player class from program 1.
Each playerwill have a first name, last name, a position (strings) and a batting average (floating
point number).
This program adds on to the requirements for Program #1. This will read int he same type of
player data from an input file and write the results to an output file.
New Requirements
You are to reuse your Player class from Program1. You are to implement a PlayerList data
structure/data type that stores players in a Linked List structure (internal to the class). Store the
players in the list in alphabetical order (By lastname, use firstname to further distinguish in the
event there is more than 1 player with the same last name).
You will need to add the class PlayerList and the class Node to facilitate the linked list
operations.
You must implement the following operations on your PlayerList along with any other utility
functionsyou might need. You may also need to add operations to the class Player to facilitate
comparisons sincePlayer data is private.
Operations
Default Constructor
Destructor
Add a Player to the List
Iterate through the List so that you can get each player
Clear out the list to make it empty
Test if a list isEmpty
Get the size of the list
Find a Player in the List (get) - Put a couple of hard-coded calls in your main program to make
sure this feature works.
Summary of Operation
Prompt the user for the input and output file names. DO NOT hardcode file names into your
program.
Open input file
Read each player and add them to your PlayerList Keep track of the number of players in the list
Store the players in the list in alphabetical order (lastname then firstname in the event of
twopeople with the same last name). You should be adding them in between other nodes
asappropriate
Test your find operation a couple of times. This can be hardcoded into your program. You donot
have to prompt the user for players, unless you wish to. Just make sure you test for playersthat
exist and that do not
Open an output file Write each player from the list into the output file, along with any other
output required by theassignment
Split your program code files into the appropriate .cpp and .h files for each of your
classes.(Exception - your NODE class can be defined in the same file as the PlayerList).
Detailed comments describing what is happening
Here is the input file:
Chipper Jones 3B 0.303
Rafael Furcal SS 0.281
Hank Aaron RF 0.305
Here is my player.h file
// Class Definition: Player
// Version 1
// This class defines an object to hold information about
// baseball player for use in a player database.
//--------------------------------------------------------
#include
using namespace std;
class Player {
string m_firstName; // player\'s first name
string m_lastName; // player\'s last name
string m_position; // player\'s primar.
More Related Content
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Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...ssuserf63bd7
name:test bank for Intermediate Accounting, Volume 2, 13th Canadian Edition Donald E. Kieso
Edition:Volume 2, 13th Canadian Edition
author:Donald E. Kieso
ISBN:9781119780311
type:Test bank
format:word/zip
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https://qidiantiku.com/test-bank-for-intermediate-accounting-volume-2-13th-canadian-edition-by-donald-e-kieso.shtml
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Contingent liabilities, commitments and provisions in oil industryHamdy Rashed
What is the different between contingency, commitment and provision, how disclose the Joint venture minimum exploration payment or obligation in the financial statements
Accounting services overview of insurance contract under ifrsAhmedTalaat127
The majority of accounting services in Dubai and UAE ignore insurance accounting because they are not in the insurance business. Now that there will be a new accounting standard related to insurance contracts, chartered accountants should check to make sure they aren’t erroneously issuing them.
McKonly & Asbury’s April webinar entitled, “Leasing: A New Standard is Finally Here” is hosted by Dan Sturm, Partner; Brett Bauer, Senior Manager; and Tim Showers, Supervisor. During this webinar, attendees will learn how ASC 842 differs from ASC 840; will see illustrative financial statements which highlight exactly what changes as a result of the new standard; and will gain an understanding of what they should be doing now to prepare.
Topic: Income Tax and Leases
Type: CourseWork
Subject: Accounting and Finance
Academic Level: Undergraduate
Style: MLA
Language: English (U.S)
Number of Pages: 3 (double-spaced, Times New Roman, Font 12)
Number of sources: 1
Task Details :
There are three general views regarding inter period income tax allocation: no allocation, partial allocation, and comprehensive allocation. Required: a. Defend the position of no allocation of income taxes. b. Defend the position of partial allocation of income taxes. c. Defend the position of comprehensive allocation of income taxes. Capital leases and operating leases are the two classifications of leases described in FASB pronouncements from the standpoint of the lessee.
Required:
a. Describe how a capital lease would be accounted for by the lessee both at the inception of the lease and during the first year of the lease, assuming the lease transfers ownership of the property to the lessee by the end of the lease.
b. Describe how an operating lease would be accounted for by the lessee both at the inception of the lease and during the first year of the lease, assuming the lessee makes equal monthly payments at the beginning of each month of the lease.
c. Describe Direct Financing and Capital Contracts
Finvision impact series 1 - ed leases - lessee accountingFinvision
IFRS accounting - Exposure draft on lease accounting has been released recently. The presentation gives an brief overview on the basic principles and how it may impact your organization
Lease Accounting Methodology: A Theoretical Reflectioniosrjce
The purpose of this paper is to examine lease accounting methods and x-ray how they influence a
choice of lease arrangements. Requirements of International Accounting Standards (IAS) 17 were considered
including theoretical framework on the various dimensions of leasing. From archival data, preference is given
to operating leases as an off-statement of financial position financing. It also possesses few bottlenecks than
finance leases in terms of compliance with accounting requirements. Consequently, it is essential to take
cognisance of the complexities inherent in the respective lease options before deciding on which one to
undertake. Moreover, the need to be computer literate as a result of growing trends in information and
communication technology (ICT) is vital because most leasing arrangements presently, are perfected using
sophisticated software
H&M The Challenges of Global Expansion and the Move to adopt Intern.pdffazanmobiles
H&M: The Challenges of Global Expansion and the Move to adopt International Financial
Reporting standards Hennes & Mauritz AB (also known as H&M) , the Swedish MNE that is a
trendsetter in the latest fashion trends, has a stated goal “to give customers unbeatable value by
offering fashion and quality at the best price.” It doesn’t own any factories, but rather outsources
production to independent suppliers, primarily in Asia and Europe. H&M also rents space from
international and local landlords rather than owning its own stores. H&M is a major firm in the
apparel retail market where fashion trends are critical and where goods move quickly. In this
industry, the key buyers are consumers, and the key suppliers are clothing manufacturers and
wholesalers, and designers are king and a fast, well-organized supply chain is essential.
Depending on the individual firm strategy, the apparel retail market doesn’t have to be capital
intensive, but the largest players in the industry are very international, both in retail footprint and
suppliers. The biggest companies in the industry are U.S.-based The Gap, H&M, and Spain-
based Industria de Diseno Textil, S.A. (Inditex), better known by its flagship brand, Zara. All
three companies have different store brands: Gap, Banana Republic, Old Navy, and Athleta for
The Gap; H&M, COS (collection of style), Monki, Weekday, and Cheap Monday for H&M; and
Zara, Bershka, Pull and bear, Massimo Dutti, Stradivarius, Oysho, Zara Home and Uterque for
Inditex. Both of H&M’s competitors are very international. H&M operates about 2,800 stores in
49 markets, whereas The Gap operates 3,100 company stores and over 300 franchise stores
worldwide, and Inditex operates in a network of over 5,000 stores in 77 countries. Zara has the
largest geographic spread within Inditex with stores in 74 countries. Hennes & Mauritz AB
started as a single women’s wear store in Sweden in 1947. Today, H&M’s business is much
broader and currently includes the sales of clothing, accessories, footwear, cosmetics, and home
textiles. Although H&M is known as one of Sweden’s premier MNEs, it generates 21.5% of its
sales in Germany, 8.9% in the United States, and 7.4% in the United Kingdom, compared to only
5.8% of total sales in Sweden. H&M and Zara have very different strategies. Zara delivers new
products to its stores twice a week. Because of its highly organized supply chain, Zara only takes
10–15 days to go from design to the stores. Although it sources its apparel from around the
world, it has adopted just-in-time manufacturing from the auto industry and established 14 highly
automated Spanish factories where robots cut and dye fabrics creating the unfinished “gray
goods” which are the foundation for their final products. It then takes the gray goods and
outsources them to a network of small shops in Portugal and Spain to do the finish work. Store
managers are constantly sending updated information on consumer demand so that they can
move to the n.
C++ ProgrammingYou are to develop a program to read Baseball playe.pdffazanmobiles
C++ Programming
You are to develop a program to read Baseball player statistics from an input file. Each player
should bestored in a Player object. Therefore, you need to reuse the Player class from program 1.
Each playerwill have a first name, last name, a position (strings) and a batting average (floating
point number).
This program adds on to the requirements for Program #1. This will read int he same type of
player data from an input file and write the results to an output file.
New Requirements
You are to reuse your Player class from Program1. You are to implement a PlayerList data
structure/data type that stores players in a Linked List structure (internal to the class). Store the
players in the list in alphabetical order (By lastname, use firstname to further distinguish in the
event there is more than 1 player with the same last name).
You will need to add the class PlayerList and the class Node to facilitate the linked list
operations.
You must implement the following operations on your PlayerList along with any other utility
functionsyou might need. You may also need to add operations to the class Player to facilitate
comparisons sincePlayer data is private.
Operations
Default Constructor
Destructor
Add a Player to the List
Iterate through the List so that you can get each player
Clear out the list to make it empty
Test if a list isEmpty
Get the size of the list
Find a Player in the List (get) - Put a couple of hard-coded calls in your main program to make
sure this feature works.
Summary of Operation
Prompt the user for the input and output file names. DO NOT hardcode file names into your
program.
Open input file
Read each player and add them to your PlayerList Keep track of the number of players in the list
Store the players in the list in alphabetical order (lastname then firstname in the event of
twopeople with the same last name). You should be adding them in between other nodes
asappropriate
Test your find operation a couple of times. This can be hardcoded into your program. You donot
have to prompt the user for players, unless you wish to. Just make sure you test for playersthat
exist and that do not
Open an output file Write each player from the list into the output file, along with any other
output required by theassignment
Split your program code files into the appropriate .cpp and .h files for each of your
classes.(Exception - your NODE class can be defined in the same file as the PlayerList).
Detailed comments describing what is happening
Here is the input file:
Chipper Jones 3B 0.303
Rafael Furcal SS 0.281
Hank Aaron RF 0.305
Here is my player.h file
// Class Definition: Player
// Version 1
// This class defines an object to hold information about
// baseball player for use in a player database.
//--------------------------------------------------------
#include
using namespace std;
class Player {
string m_firstName; // player\'s first name
string m_lastName; // player\'s last name
string m_position; // player\'s primar.
Discuss the differences between a lists regular iterator, which su.pdffazanmobiles
Discuss the differences between a list\'s regular iterator, which supports the use of a \"for\" loop,
and its other list iterator that supports position-based operations. Discuss the advantages and
disadvantages of each.
Solution
Both iterator or list iterator is same for purpose ..i.e is to iterate through the list we have.
but the major difference between list iterator and iterator is quite simple
list iterator can iterate in both direction forward and backward direction ..it can move previous
and even next.
but in regular iterator..it can iterate only in one direction.that is only unidirection.it can move
only forward .
and one thing we should keep in mind that ..list iterator itarates only for list..but not for set map
etc.
where as regular iterator works beyond than that.it uses form list ,map.set etc.
listiterator comes up with other benifit is..it can modify the data inside list during iteration like
adding removing etc.
but in regualar iterator we cannot add element at a time of itearation..we can remove element ..
and another advantage of listiterator is..listiterator can get curent index position when traversing
but ..normal iterator cannot give that ..as it get the index positon by using prev and next but
normal iterator doesn not
iterator is not a class it is an interface and even listiterator is also an interface.
both are comes in java 1.2 and part of collection framework.
Feasibility is an important issue in security system formulation. Wh.pdffazanmobiles
Feasibility is an important issue in security system formulation. What are the two different
dimensions of feasibility that might affect the development of a real-world solution?
Solution
Feasibility in security system formulation is always going to help the security industry to grow in
a better manner possible. Because feasibility means convenience and whenever convenience is
there any organization or industry can work better on there technology level, management level
as well as their monetization model which is most important of them all to sustain. One
dimension of feasibility is convenience and another one is the ability to uncover the strengths
and weaknesses of a problem..
CopyPaste the sentence into the text box. Then, insert punctuat.pdffazanmobiles
Copy/Paste the sentence into the text box.
Then, insert punctuation or correct spelling where needed. All sentences contain one or more
errors.
1.) The three girls teacher arrived to school late.
2.) My associates clients do not seem satisfied with the service he provides.
Solution
1.
Correct Sentence:
The three girl teachers arrived at school, late.
2.
Correct answer:
My associate’s clients do not seem to be satisfied with the services, he provides..
C programming Create a system managing a mini library system. Eve.pdffazanmobiles
// C programming Create a system managing a mini library system. Every book corresponds to a
record (line) in a text file named \"mylibrary.txt\". Each record consists of 6 fields (Book ID,
Title, Author, Possession, checked out Date, Due Date) separated by comma: No comma \" \"in
title or author name. This mini library keeps the record for each book in the library. Different
books can share the book \"Title\". But the \"Book ID\" for each book is unique. One author may
have multiple books. Eg. Both book2 and book3 are written by author Possession field is
\"Library\" means this book is kept in library, such as book #001. Otherwise, this book is
checked out by the corresponding user. E.g. book #3 is checked out by User. A user is allowed to
check out up to 3 books. The \"Checked out Date\" field specifies the time of the latest checked
out date. The loan period for each book is 30 days. \"The Due Data\" filed specifies the time the
book should be returned. This system should provide a menu with following functionalities that
the bookkeeper can choose from at the top-level menu: Ask for title (read). Ask for author.
Generate a book ID by adding one to the current largest book ID. Add the record of the new
book into library with generated book ID, title, author, possession=\"library\", checked out
date=\"null\" and due date=\"null\". After that, print message \"book*** added successfully!\"
and go to step 5). Provide options \"t\" for \"\" and \"b\" for \"Back to main menu\". (If \"\", go to
step 1))
Solution
#include
#include
#include //contains delay(),getch()etc.
#include
#include //contains strcmp(),strcpy(),strlen(),etc
#include //contains toupper(), tolower(),etc
#include //contains _dos_getdate
#include
#define RETURNTIME 15
FILE *fp,*ft,*fs;
struct l_Date
{
int mm,dd,yy;
};
struct record
{
int bookid;
char title[20];
char Author[20];
char possession[20];
struct l_Date checkedout_date;
struct l_Date due_date;
};
struct record r;
void main()
{
clrscr();
int i;
printf(\" a. Add Books \");
printf(\"b. Delete books\");
printf(\"c. Search Books\");
printf(\"d. Issue Books\");
printf(\"e. View Book list\");
printf(\"f. Edit Book\'s Record\");
printf(\"g. Close Application\");
printf(\"Enter your choice:\");
switch(getch())
{
case \'a\':
addbooks();
break;
case \'b\':
deletebooks();
break;
case \'c\':
searchbooks();
break;
case \'d\':
issuebooks();
break;
case \'e\':
viewbooks();
break;
case \'f\':
editbooks();
break;
case \'g\':
{
clrscr();
printf(\"application is closing..\ \");
exit(0);
}
default:
{
printf(\"\ Please re-entered correct option\");
}
}
}
void addbooks(void) //funtion to add books
{
int i;
fp=fopen(\"Bibek.dat\",\"ab+\");
fseek(fp,0,SEEK_END);
fwrite(&r,sizeof(r),1,fp);
fclose(fp);
printf(\"The record is sucessfully saved\");
printf(\"add any more?(t / b):\");//t to try again and b to back
if(getch()==\'b\')
else
addbooks();
}
}
void deletebooks() //function delete record from file fp
{
int d;
char another=\'y\';
while(another=.
estion 47 (1 point) Raul Prebisch, based at the Economic Commission f.pdffazanmobiles
estion 47 (1 point) Raul Prebisch, based at the Economic Commission for Latin America and
Hans Singer, based t the United Nations Industrial Development Organization, both provided the
intellectual ationale for O 1) import substituting industrialization O 2) the rapid development of
the service sector industry. O 3) free trade. 4) liberation theology
Solution
Raul Prebisch and Hans Singer gave Prebisch-Singer hypothesis which formed the basis of
dependency theory and supported theories like import substitution.
The correct answer to this question is \"1\" import-substituting industrialization..
Dr. Muehls mother was a nurse and her father was a dairy farmer. S.pdffazanmobiles
Dr. Muehl\'s mother was a nurse and her father was a dairy farmer. She has gone to college and
has earned her PhD, which allowed her to become a professor at SUNY Canton. This is an
example of:
resiliency
ascribed status
social mobility
social stratificationA.
resiliencyB.
ascribed statusC.
social mobilityD.
social stratification
Solution
When a person moves from one societal status to another which the case mentioned in the
scenario of the question, it can be termed as social mobility
Therefore (C) social mobility is the answer.
CHAPTER 19 Reproductive system Disorders 24. List the STD and the org.pdffazanmobiles
CHAPTER 19 Reproductive system Disorders 24. List the STD and the organism that a.
Chancre causes a b. Vesicle C. Gumma d. Purulent exudate e. Pharyngitis f. Wart
Solution
A. chancre
The exposure of Treponema pallidum, the gram-negative spirochaete bacterium yielding
syphilis. Chancres transmit the sexually transmissible disease of syphilis through direct physical
contact. These ulcers usually form on or around the anus, mouth, penis, and vagina..
can Fluorescence Resonance Emission Transfer (FRET) Microscopy be us.pdffazanmobiles
can Fluorescence Resonance Emission Transfer (FRET) Microscopy be used to image static
structures??
Solution
The technique of fluorescence resonance energy transfer , when applied to optical microscopy,
permits determination of the approach between two molecules within several nanometers.FRET
is a powerful technique for studying molecular interactions inside living cells with improved
spatial (angstrom) and temporal (nanosecond) resolution. FRET microscopy relies on the ability
to capture fluorescent signals from the interactions of labeled molecules in single living or fixed
cells. Hence FRET Microscopy is used to image static structures..
Why is a visual analysis important in communicating findings in a bu.pdffazanmobiles
Why is a visual analysis important in communicating findings in a business research paper or
proposal? Give an example of a visual analysis that would be appropriate for your paper and
presentation (my research paper is regarding the decrease in ethics in nurses as well as having
usage of personal cell phones on the work floor). Describe acceptable report page design
methods to make your paper or presentation visually appealing.
Solution
The increase of development in IT has leaded to tremendous increase in the use of visual forms
of communication. From the early begins of usage of social anthropology, where novel
technologies of register and reproduction of images were gradually incorporated within social
anthropology in terms of ethnographic film and later visual anthropology, research with visual
technologies and on visual data has evolved into other fields in the social science.
Apart from social science, visual materials are found in a wide range of cultural spheres. They
are extensively used at various fields.
Videography, Photography plays very important roles in terms of gaining the full focus on
peculiarity of the visual and its specific symbolic structure.
The following terms will describe best about the Visual analysis usage at a greater extent. 1.
Involving, 2. Sharing and 3. Analyzing.
The three terms described above are exactly useful for the best communication of Business
Research Paper or Proposal.
Because, involving mostly related to successful participation in Trans disciplinary projects. The
photos can be analyzed as participatory acts. Sharing mostly involves in the combination of the
verbal data and visual data which leads to the easy understanding of presentation. Analysis
completely describes the different methods of analyses and show societal context.
Most of the design methods follow a simple procedure which gives a good pave to go ahead. One
of the design methods which is relevant to most of the design methods is described as follows.
Any methodology contains 1. Sample Design, 2. Data Collection Methods, 3. Data Processing
Procedures, 4. Response Rates, 5. Weighing and Variance Estimation.
All terminologies mentioned above are related to the easy understanding of the design in a
feature of successful survey and presents many issues that had to be addressed at the design
stage..
what usually happens to autoimmune antibody-producing clones dur.pdffazanmobiles
what usually happens to autoimmune antibody-producing clones during development?
what usually happens to autoimmune antibody-producing clones during development?
what usually happens to autoimmune antibody-producing clones during development?
Solution
The process of immune response against the antibodies is the same when the immune response
acts against the normal body cells. They bind with high affinity to self antigens..
Why platinum and its compounds display a variety of colorSoluti.pdffazanmobiles
Why platinum and its compounds display a variety of color?
Solution
Platinum and its compounds exhibit varieties of color because plantinum in its compounds have
d electrons in their respective orbitals which absorb wavelengths from Ultra violet and visible
light region of electromagnetic radiation and give off complimentary color and in this way
platinum generally appreas greyish white in color..
What is Vertical versus horizontal integration in healthcare W.pdffazanmobiles
What is Vertical versus horizontal integration in healthcare?
What is Vertical versus horizontal integration in healthcare?
Solution
in healthcare a vertical integration is the arrangement, a healthcare organization provide and
offer various services to the patients and needed people either directly or indirectlty, which
includes some support services or a broad range of patient care services. In this the care
providers think before and after the work or role he has done to the patients. The service
providers interacted and integrated with similar parties, exchange, share, and at the end benefit
all. Most of the care centers which offers variety of services join together, and exchange
information or patients also.
in horizontal integraion, one kind of services are offered by the care centers, all these joined as a
group for sharing the work. Here the care provider may look for other provider who do the same,
and join with them. It helps them to utilize their resoruces in optimum way and minimize
wastage. Forexample: these both can maintain a group of professional doctors, they can utilize
them in both places based on demand from patients..
What is the role of the financial system Name and describe two mark.pdffazanmobiles
What is the role of the financial system? Name and describe two markets that are part of the
financial system in the U.S. economy. Name and describe two financial intermediaries. What is
the difference between savings and investment (according to economists) and what role does the
financial system serve in bridging the gap between savings and investment? Explain why a
person would want to invest in stocks and bonds rather than keep their money in a savings
account.? ( 200 words)
Solution
Ans.
The financial system is concerned about credit, money and finance. It is a set of complex and
inter-mixed financial institutions ,financial markets, financial instruments and services.It is a
system that enables lenders and borrowers to exchange funds.It serves as a link between savers
and investors.Financial system promotes the process of capital formation and is a mechanism of
transfer of resources.Such as it channelise savings into business sector by offering loans.
Most important financial market is bonds market.In this market bond is like a contract paper with
maturity date and rate at which it is paid back to buyers.The money that companies get from
bonds can be further used for making profitable projects.When bond matures it is paid back to
purchaser with interest. The other market is of stocks market where stocks are issued by selling
shares to the public and trading is done with stockholders in stock exchange.It has higher returns
than bonds.
The two financial intermediaries are banks and mutual funds.Where banks are the financial
institutions that receives deposits and make loans.They pay interest on their deposits and charge
borrowers higher interst rate on their loans.Mutual funds are investment that uses money from
many investors to invest in bonds and stocks.
Savings are part of disposable income that is left after consumption of goods and
accumulated.Whereas investment means addition to stock of capital goods that adds to the future
productive capacity of the economy. Financial system is an important vehicle for economic
transformation.It bridges the gap between savings and investment through efficient mobilization
and allocation of surplus funds.It facilitates flow of funds from areas of surplus to deficit.
The money in savings account cannot be sold or traded to other investors such that they are not
negotiable, Whereas bonds are sold by investors to other investors before bonds reach there
maturity date.Money in savings account offers less return than bonds but bonds offer higher
returns which are considered as safe investment when borrowed from goverenment .so its better
to invest in stocks and bonds rather than keeping money in savings account..
What is the difference between a paired artery and an unpaired arter.pdffazanmobiles
What is the difference between a paired artery and an unpaired artery?
Solution
Paired Artery:
The abdominal aorta is the largest artery in the abdominal cavity. As part of the aorta, it is a
direct continuation of the descending aorta (of the thorax).
Anatomy Any of the muscular elastic tubes that form a branching system and that carry blood
away from the heart to the cells, tissues, and organs of the body. 2. A major route of
transportation into which local routes flow: Traffic was heavy on the central artery.
Unpaired Artery:
an unpaired artery that is formed by the union of the two vertebral arteries, runs forward within
the skull just under the pons, divides into the two posterior cerebral arteries, and supplies the
pons, cerebellum, posterior part of the cerebrum, and the inner ear..
What has Microsoft improved in Windows Server 2012 when it comes to .pdffazanmobiles
What has Microsoft improved in Windows Server 2012 when it comes to provisioning and
administrating a virtualized environment?
Solution
Windows Server 2012:
Windows server 2012 is the 6th version of windows server family. Microsoft introduced
windows server 2012 and BUILD 2011 of developer preview. Unlike windows 8, windows
server 2012 developer made provisions to MSDN subscribers. Microsoft improves, Windows
Update, Window Server Update Services, system center configuration manager and release an
update that extends the finishing date from 8th April 2012 to 15th January 2013.
Based on provisions: made to MSDN subscribers
Based on virtual environment: It is generally made for customers..
What are the steps for developing Developing a Project Scope Stateme.pdffazanmobiles
What are the steps for developing Developing a Project Scope Statement?
Solution
A scope statement has to be created in order to convince and get agreement from the client and
other stakeholders. With a scope statement you are more likely to decrease the changes of
miscommunication
The scope statement should be created by including the following points:.
True or False Questions1) Good technology transfer between pr.pdffazanmobiles
True or False Questions:
1) Good technology transfer between projects is one of the major advantages of projectized
organization. ( T or F)
2) Program Management is less comprehensive and inclusive than project management.( T or F)
3) The partnership type of organization is very difficult to organize as it has relatively large
restrictions. (T or F).
4) Forecasting estimates the results and planning provides strategies. (T or F)
Multiple choice questions:
1) The distribution that you use for networks in project considering probability of three times is
known as:
A) Normal distribution
B) Exponential distribution.
C. Binomial distribution
D) Negative exponential distribution
E. None of the above
2) The biggest Advantage/advantages of the exponential smoothing method of forecasting is:
A) No waiting period is required and not a large data is required even then reasonably good
forecasting.
B) It includes the benefits of the time series analysis of forecasting as it belongs to this category.
C) The value of alpha (smoothing constant )can be made to change or adapt to changed
circumstances.
D. All of the above
E. Only A and B.
3) The important disadvantage/disadvantages of MBO as observed are:
A. Time and paper work involved
B. Supervisor just assigns and does not negotiate
C. It leads to Gamesmanship of subordinates
D. It does not avoid the tendency of subordinates to focus on relatively few goals.
E. All of the above
4) The title \'section chief or foreman, is used for which of the following position?
A) team leader
B. middle manager
C. first-line manager
D. top manager
E. Aged worker
5) About the middle managers which of the following is true?
A. Make plan of intermediate range to achieve long terr goals
B. Integrate and coordinate the short range decisions and activities
C. Establish department policies together
D. Options A and B are true if taken together
E. options A, B, and C, are true if taken
True or False Questions:
1) Good technology transfer between projects is one of the major advantages of projectized
organization. ( T or F)
2) Program Management is less comprehensive and inclusive than project management.( T or F)
3) The partnership type of organization is very difficult to organize as it has relatively large
restrictions. (T or F).
4) Forecasting estimates the results and planning provides strategies. (T or F)
Multiple choice questions:
1) The distribution that you use for networks in project considering probability of three times is
known as:
A) Normal distribution
B) Exponential distribution.
C. Binomial distribution
D) Negative exponential distribution
E. None of the above
2) The biggest Advantage/advantages of the exponential smoothing method of forecasting is:
A) No waiting period is required and not a large data is required even then reasonably good
forecasting.
B) It includes the benefits of the time series analysis of forecasting as it belongs to this category.
C) The value of alpha (smoothing constant )can be made to chan.
The symbiosis between plant roots and fungi is characterized byQu.pdffazanmobiles
The symbiosis between plant roots and fungi is characterized by:
Question 2 options:
Fungi “fix” atmospheric nitrogen for plants
Plants provide a safe place inside which fungi can live
Plants receive carbon in exchange for nutrients
Plants receive nutrients in exchange for carbo
Fungi “fix” atmospheric nitrogen for plants
Plants provide a safe place inside which fungi can live
Plants receive carbon in exchange for nutrients
Plants receive nutrients in exchange for carbo
Solution
Correct options:
A. Fungi “fix” atmospheric nitrogen for plants
C. Plants receive nutrients in exchange for carbo
Explanation:
Fungi had an ability to easily absorb elements such a phosphorus and nitrogen which are
essential for life.
Plants are autotrophic and it producing their food in the form of carbohydrates through the
process of photosynthesis.
plants access to these essential compounds and elements. In return, the plant supplies the fungus
with carbohydrates for use as energy..
A Strategic Approach: GenAI in EducationPeter Windle
Artificial Intelligence (AI) technologies such as Generative AI, Image Generators and Large Language Models have had a dramatic impact on teaching, learning and assessment over the past 18 months. The most immediate threat AI posed was to Academic Integrity with Higher Education Institutes (HEIs) focusing their efforts on combating the use of GenAI in assessment. Guidelines were developed for staff and students, policies put in place too. Innovative educators have forged paths in the use of Generative AI for teaching, learning and assessments leading to pockets of transformation springing up across HEIs, often with little or no top-down guidance, support or direction.
This Gasta posits a strategic approach to integrating AI into HEIs to prepare staff, students and the curriculum for an evolving world and workplace. We will highlight the advantages of working with these technologies beyond the realm of teaching, learning and assessment by considering prompt engineering skills, industry impact, curriculum changes, and the need for staff upskilling. In contrast, not engaging strategically with Generative AI poses risks, including falling behind peers, missed opportunities and failing to ensure our graduates remain employable. The rapid evolution of AI technologies necessitates a proactive and strategic approach if we are to remain relevant.
Instructions for Submissions thorugh G- Classroom.pptxJheel Barad
This presentation provides a briefing on how to upload submissions and documents in Google Classroom. It was prepared as part of an orientation for new Sainik School in-service teacher trainees. As a training officer, my goal is to ensure that you are comfortable and proficient with this essential tool for managing assignments and fostering student engagement.
Embracing GenAI - A Strategic ImperativePeter Windle
Artificial Intelligence (AI) technologies such as Generative AI, Image Generators and Large Language Models have had a dramatic impact on teaching, learning and assessment over the past 18 months. The most immediate threat AI posed was to Academic Integrity with Higher Education Institutes (HEIs) focusing their efforts on combating the use of GenAI in assessment. Guidelines were developed for staff and students, policies put in place too. Innovative educators have forged paths in the use of Generative AI for teaching, learning and assessments leading to pockets of transformation springing up across HEIs, often with little or no top-down guidance, support or direction.
This Gasta posits a strategic approach to integrating AI into HEIs to prepare staff, students and the curriculum for an evolving world and workplace. We will highlight the advantages of working with these technologies beyond the realm of teaching, learning and assessment by considering prompt engineering skills, industry impact, curriculum changes, and the need for staff upskilling. In contrast, not engaging strategically with Generative AI poses risks, including falling behind peers, missed opportunities and failing to ensure our graduates remain employable. The rapid evolution of AI technologies necessitates a proactive and strategic approach if we are to remain relevant.
The French Revolution, which began in 1789, was a period of radical social and political upheaval in France. It marked the decline of absolute monarchies, the rise of secular and democratic republics, and the eventual rise of Napoleon Bonaparte. This revolutionary period is crucial in understanding the transition from feudalism to modernity in Europe.
For more information, visit-www.vavaclasses.com
Francesca Gottschalk - How can education support child empowerment.pptxEduSkills OECD
Francesca Gottschalk from the OECD’s Centre for Educational Research and Innovation presents at the Ask an Expert Webinar: How can education support child empowerment?
Introduction to AI for Nonprofits with Tapp NetworkTechSoup
Dive into the world of AI! Experts Jon Hill and Tareq Monaur will guide you through AI's role in enhancing nonprofit websites and basic marketing strategies, making it easy to understand and apply.
Biological screening of herbal drugs: Introduction and Need for
Phyto-Pharmacological Screening, New Strategies for evaluating
Natural Products, In vitro evaluation techniques for Antioxidants, Antimicrobial and Anticancer drugs. In vivo evaluation techniques
for Anti-inflammatory, Antiulcer, Anticancer, Wound healing, Antidiabetic, Hepatoprotective, Cardio protective, Diuretics and
Antifertility, Toxicity studies as per OECD guidelines
Read| The latest issue of The Challenger is here! We are thrilled to announce that our school paper has qualified for the NATIONAL SCHOOLS PRESS CONFERENCE (NSPC) 2024. Thank you for your unwavering support and trust. Dive into the stories that made us stand out!
Home assignment II on Spectroscopy 2024 Answers.pdf
An analyst has decided to capitalize the operating leases of Company.pdf
1. An analyst has decided to capitalize the operating leases of Company A. Using information in
the notes to the company’s 2015 financial statements, she has determined that the present value
of future minimum lease payments, at a discount rate of 10 percent, on December 31, 2015
equals €500 million. All lease contracts last another 5 years on December 31, 2015. As expected
at the beginning of the year, the company reports an operating lease expense in its income
statement for 2016 of €80 million. The company’s tax rate equals 30 percent. The company does
not engage in any new operating leases in 2016. The following information is also available from
Company A’s financial statements (all ratios use beginning-of-the-year balance sheet values)
Debt to capital (at beginning of 2016) = 0.55
Return on beginning equity in 2016 = 0.10
Assets / Capital (at beginning of 2016) = €3,400 million
The effect of capitalizing Company A’s operating leases on its return on beginning equity equals
A. An increase from 0.10 to 0.15 (rounded).
B. An increase from 0.10 to 0.13 (rounded).
C. A decrease from 0.10 to 0.07 (rounded).
D. A decrease from 0.10 to 0.05 (rounded).
Solution
accounting topic of leases is a popular Paper F7 exam area that could feature to varying degrees
in Questions 2, 3, 4 or 5 of the exam. This topic area is currently covered by IAS 17, Leases. IAS
17, Leases takes the concept of substance over form and applies it to the specific accounting area
of leases.
When applying this concept, it is often deemed necessary to account for the substance of a
transaction – ie its commercial reality, rather than its strict legal form. In other words, the legal
basis of a transaction can be used to hide the true nature of a transaction. It is argued that by
applying substance, the financial statements become more reliable and ensure that the lease is
faithfully represented.
WHY DO WE NEED TO APPLY SUBSTANCE TO A LEASE?
A lease agreement is a contract between two parties, the lessor and the lessee. The lessor is the
legal owner of the asset, the lessee obtains the right to use the asset in return for rental payments.
2. Historically, assets that were used but not owned were not shown on the statement of financial
position and therefore any associated liability was also left out of the statement – this was known
as ‘off balance sheet’ finance and was a way that companies were able to keep their liabilities
low, thus distorting gearing and other key financial ratios. This form of accounting did not
faithfully represent the transaction. In reality a company often effectively ‘owned’ these assets
and ‘owed a liability’.
Under modern day accounting the IASB framework states that an asset is ‘a resource controlled
by an entity as a result of past events and from which future economic benefits are expected to
flow to the entity’ and a liability is ‘a present obligation of the entity arising from past events, the
settlement of which is expected to result in an outflow from the entity of resources embodying
economic benefits’. These substance-based definitions form the platform for IAS 17, Leases.
SO HOW DOES IAS 17 WORK?
IAS 17 states that there are two types of lease, a finance lease and an operating lease. The
definitions of these leases are vital and could be required when preparing an answer in the exam.
Finance lease
A finance lease is a lease that transfers substantially all the risks and rewards incidental to
ownership of an asset to the lessee.
Operating lease
An operating lease is defined as being any lease other than a finance lease.
Classification of a lease
In order to gain classification of the type of lease you are dealing with, you must first look at the
information provided within the scenario and determine if the risks and rewards associated with
owning the asset are with the lessee or the lessor. If the risks and rewards lie with the lessee then
it is said to be a finance lease, if the lessee does not take on the risks and rewards, then the lease
is said to be an operating lease.
Finance lease indicators
There are many risks and rewards outlined within the standard, but for the purpose of the Paper
F7 exam there are several important areas. The main reward is where the lessee has the right to
use the asset for most of, or all of, its useful economic life. The primary risks are where the
lessee pays to insure, maintain and repair the asset.
When the risks and rewards remain with the lessee, the substance is such that even though the
lessee is not the legal owner of the asset, the commercial reality is that they have acquired an
asset with finance from the leasing company and, therefore, an asset and liability should be
recognised.
Other indicators that a lease is a finance lease include:
3. At the inception of the lease the present value of the minimum lease payments* amounts to
substantially all of the fair value of the asset
The lease agreement transfers ownership of the asset to the lessee by the end of the lease
The leased asset is of a specialised nature
The lessee has the option to purchase the asset at a price expected to be substantially lower than
the fair value at the date
accounting topic of leases is a popular Paper F7 exam area that could feature to varying degrees
in Questions 2, 3, 4 or 5 of the exam. This topic area is currently covered by IAS 17, Leases. IAS
17, Leases takes the concept of substance over form and applies it to the specific accounting area
of leases.
When applying this concept, it is often deemed necessary to account for the substance of a
transaction – ie its commercial reality, rather than its strict legal form. In other words, the legal
basis of a transaction can be used to hide the true nature of a transaction. It is argued that by
applying substance, the financial statements become more reliable and ensure that the lease is
faithfully represented.
WHY DO WE NEED TO APPLY SUBSTANCE TO A LEASE?
A lease agreement is a contract between two parties, the lessor and the lessee. The lessor is the
legal owner of the asset, the lessee obtains the right to use the asset in return for rental payments.
Historically, assets that were used but not owned were not shown on the statement of financial
position and therefore any associated liability was also left out of the statement – this was known
as ‘off balance sheet’ finance and was a way that companies were able to keep their liabilities
low, thus distorting gearing and other key financial ratios. This form of accounting did not
faithfully represent the transaction. In reality a company often effectively ‘owned’ these assets
and ‘owed a liability’.
Under modern day accounting the IASB framework states that an asset is ‘a resource controlled
by an entity as a result of past events and from which future economic benefits are expected to
flow to the entity’ and a liability is ‘a present obligation of the entity arising from past events, the
settlement of which is expected to result in an outflow from the entity of resources embodying
economic benefits’. These substance-based definitions form the platform for IAS 17, Leases.
SO HOW DOES IAS 17 WORK?
IAS 17 states that there are two types of lease, a finance lease and an operating lease. The
definitions of these leases are vital and could be required when preparing an answer in the exam.
Finance lease
A finance lease is a lease that transfers substantially all the risks and rewards incidental to
4. ownership of an asset to the lessee.
Operating lease
An operating lease is defined as being any lease other than a finance lease.
Classification of a lease
In order to gain classification of the type of lease you are dealing with, you must first look at the
information provided within the scenario and determine if the risks and rewards associated with
owning the asset are with the lessee or the lessor. If the risks and rewards lie with the lessee then
it is said to be a finance lease, if the lessee does not take on the risks and rewards, then the lease
is said to be an operating lease.
Finance lease indicators
There are many risks and rewards outlined within the standard, but for the purpose of the Paper
F7 exam there are several important areas. The main reward is where the lessee has the right to
use the asset for most of, or all of, its useful economic life. The primary risks are where the
lessee pays to insure, maintain and repair the asset.
When the risks and rewards remain with the lessee, the substance is such that even though the
lessee is not the legal owner of the asset, the commercial reality is that they have acquired an
asset with finance from the leasing company and, therefore, an asset and liability should be
recognised.
Other indicators that a lease is a finance lease include:
At the inception of the lease the present value of the minimum lease payments* amounts to
substantially all of the fair value of the asset
The lease agreement transfers ownership of the asset to the lessee by the end of the lease
The leased asset is of a specialised nature
The lessee has the option to purchase the asset at a price expected to be substantially lower than
the fair value at the date