Lease Accounting

Question 1

Initial Direct Costs (IDC)

Answer 1

IDC are capitalized (not expensed)
Lessee includes IDC in Right Of Use (ROU) Asset measurement
Commissions & payments made to current tenants to obtain the lease

Question 2

Right of Use Asset =

Answer 2

Lease liability + Lease Payments to lessor at or before comment - Lease Incentives received + Initial Direct Costs