g a lessee is evaluating whether a lease term is a major part of the remaining life of an asset in order to determine the proper lease classification. the lessee leases office space through a lease with a 10-year term. the lease has a renewal option for an additional 5 years at a rental price that is adjusted to market at time of renewal. the office building has a remaining useful life of 20 years from the commencement of the lease. the lessee plans to make a significant investment in leasehold improvements (useful life of 15 years) at the commencement of the lease. based on this information only, how would the lessee classify this lease?

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02-11-2022
Business

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g a lessee is evaluating whether a lease term is a major part of the remaining life of an asset in order to determine the proper lease classification. the lessee leases office space through a lease with a 10-year term. the lease has a renewal option for an additional 5 years at a rental price that is adjusted to market at time of renewal. the office building has a remaining useful life of 20 years from the commencement of the lease. the lessee plans to make a significant investment in leasehold improvements (useful life of 15 years) at the commencement of the lease. based on this information only, how would the lessee classify this lease?

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