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Funding a business
Lease classification in Business
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[QUOTE="Yakub02, post: 310745, member: 94426"] Initial direct costs of manufacturer or dealer lessors in connection with negotiating and arranging a lease are excluded from the definition of initial direct costs. As a result, they are excluded from the net investment in the lease. The treatment of similar costs incurred by manufacturers and dealers is explained later. Subsequent measurement of the receivable During each year, the lessor receives payments from the lessor A finance lease receivable (net investment in the lease) is measured in the same way as any other financial asset The finance charge is recognised as income in profit or loss for the period. The partial repayment of the lease receivable reduces the amount owed to the lessor [/QUOTE]
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