GASB 87 Lessee Lease Accounting Example

Let’s take as an example a copier lease. The copier costs $8,000 to purchase new; the lessor is willing to lease it to you for 3 years at a price of $250 per month, paid at the beginning of each month, commencing on July 1, 2022. Of that, $41 is identified as the cost of maintenance. If you borrowed money for three years, you would have to pay 4% interest. If you bought the copier, you would normally depreciate it over 5 years. You have no initial direct costs; you also don’t know if the lessor has any initial direct costs. Download Now to access our full GASB 87 Lessee Lease Accounting Example!