Which of the Following Is True Regarding the Deferral of Sale

question 49

Multiple Choice

Which of the following is true regarding the deferral of sale profits on a sale-leaseback under IAS 17,"Accounting for Leases?

• A) Any profit on a sale-leaseback resulting in an operating lease is deferred and recognized over the subsequent lease period,whereas any loss is recognized immediately.
• B) Both profits and losses on a sale followed by an operating lease leaseback are recognized immediately if the transaction is established at fair value.
• C) Profit from the sale should be deferred and amortized in proportion to the amortization of the leased asset if a capital lease results from the sale-leaseback.
• D) Profit from the sale should be amortized in proportion to the rental payments it an operating lease results from the sale-leaseback.

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Definitions:

Rods and Cones

Types of photoreceptor cells in the retina of the eye, with rods being responsible for vision at low light levels and cones for color vision and fine detail.

Sclera

The sclera is the white outer layer of the eyeball, providing structure and protection.

Ciliary Ring

A structure in the eye made up of muscles that control the shape of the lens for focusing light on the retina.

Vitreous Humor

The clear gel that fills the space between the lens and the retina of the eyeball, helping maintain its shape and allowing light to pass through.