Headquarters, Suite 200 Sample
Real estate, leased from Camelback Office Partners, Suite 200. Commenced Jan 1, 2026, ends Dec 1, 2030.
- Term
- 60 months, paid in advance
- Discount rate
- 6.00%
- Liability at commencement
- 265,041.97
- ROU at commencement
- 256,541.97
- Straight-line cost
- 5,000.80 per period
- Transfer of ownershipNot metOwnership of the asset transfers to the lessee by the end of the term.
- Purchase option reasonably certainNot metA purchase option the lessee is reasonably certain to exercise.
- Major part of remaining economic lifeNot met, 12.50%Lease term ÷ remaining economic life, compared with the policy threshold.
- Substantially all of fair valueNot met, 22.09%Present value of lease payments (including any probable residual value guarantee) ÷ fair value, compared with the policy threshold.
- Specialized assetNot metThe asset has no alternative use to the lessor at the end of the term.
Conclusion: operating lease. Not eligible for the short-term election.
Initial measurement
| Present value of lease payments (lease liability) | 265,041.97 |
| Plus: prepaid rent | – |
| Plus: initial direct costs | 1,500.00 |
| Less: incentives received | (10,000.00) |
| ROU asset | 256,541.97 |