How to record residual value guarantee change
Adjusting the lease liability for changes in estimated payments under a residual value guarantee.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| ROU Asset | Asset | 2,000.00 | - |
| Lease Liability | Liability | - | 2,000.00 |
💡 Accountant's Note
Lessees remeasure the lease liability to reflect changes in the amount expected to be payable under a residual value guarantee. The discount rate is generally not updated for this type of remeasurement.
Practitioner & Systems Framework
💻 ERP Architecture
Adjust the balloon payment or terminal value field in the lease amortization schedule.
⚠️ Audit Flags
Fluctuations in secondary market prices for leased assets near the end of lease terms.
📄 Required Documentation
Market valuation reports or manufacturer residual value guides for the underlying asset.
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