ASC 842
In accounting, ASC 842 means topic 842, Leases — puts nearly every lessee lease longer than twelve months on the balance sheet as a right-of-use asset and a lease liability, classified as operating or finance.
- Layer
- Lexicon
- Defined in
- Lexicon
- Nearby
- 4
Authority
This definition follows ASC 842-20-25-1.
Every citation in this system, with the text we read and the date we checked it, is in US GAAP and where these rules come from.
ASC 842, in use
Quoted from the document that use the word — what it does to an interface, in the spec's own sentence.
Under ASC 842, operating vs. finance classification changes the P&L and the balance sheet presentation.
Schedules, accruals & roll-forwards — 7. Leases (ASC 842 / IFRS 16)
For founders
The same idea written for a founder: what it costs a startup that ignores it, and what to do in a real month.
What it is not called
Each of these is a real word for a different thing. Using it here is what makes a product read as though it was built by someone who has not done the work.
- ASC 840 (superseded)
- off-balance-sheet lease
Nearby in the catalog
No component names this concept outright. These are the ones in its part of the system, which is a weaker claim — but a component nothing links to is a component nobody finds.
6Statements
Family specTerms this one depends on
- Right-of-use assetThe lessee's right to use an underlying asset for the lease term — the lease liability plus prepaid lease payments and initial direct costs, less incentives received
- Lease liabilityThe present value of the lease payments not yet paid, discounted at the rate implicit in the lease or, if not determinable, the incremental borrowing rate
- Balance sheetAssets, liabilities and equity at a point in time, proving the accounting equation
- LiabilityA present obligation of the entity to transfer an economic benefit (FASB CON 8 ¶E37)
- AssetA present right of the entity to an economic benefit (FASB CON 8 ¶E16)
Also in Fixed assets & leases
Defined in Lexicon. This page is generated from that document, so the two cannot disagree.