How Lessors Report Operating Leases
When a lease is classified as an operating lease, the related assets and liabilities are kept off of the lessee’s balance sheet. Logically, this means that they remain on the lessor’s balance sheet. The lessor’s balance sheet will show the asset, and depreciation of the asset will be counted as an expense on the income statement and reduce the carrying value of the asset.
The lessor will record lease revenue as the lease payments are received.
For more information, see all articles on: Accounting, Common Size Analysis, Financial Statement Analysis, Fundamental Analysis, Ratio Analysis See also:
The Intelligent Investor: The Classic Text on Value Investing
Financial Statement Analysis: A Practitioner's Guide, 3rd Edition
Managing Investment Portfolios: A Dynamic Process (CFA Institute Investment Series)
