Overview
What this challenge is about.
Your team's task is to implement ASC 842 for Taco Fresco's 50 leases. You have a spreadsheet with lease data: commencement dates, terms, renewal options, annual rent (including escalations), and incremental borrowing rates. You must determine the lease term (considering renewal options), calculate the present value of lease payments, and record the ROU asset and lease liability. Deliver a transition memo, a summary schedule of all leases, and the journal entries for the transition date. Success means accurate application of ASC 842 and clear documentation for the external auditors.
The Brief
What you'll do, and what you'll demonstrate.
How should Taco Fresco transition its lease portfolio from ASC 840 to ASC 842, including determination of lease term and calculation of ROU assets and liabilities?
Earning criteria — what you'll demonstrate
- Apply ASC 842 lease accounting principles to a portfolio of leases
- Determine lease term including renewal options based on reasonable certainty
- Calculate present value of lease payments using incremental borrowing rate
- Prepare transition journal entries and disclosures
Program Fit
Where this fits in your program.
Sharpens the same skills your degree expects you to demonstrate.
Skills
Skills you'll demonstrate.
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Careers
Roles this prepares you for.
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Career mappings coming soon.