USA Inventory

[bobAnInvestorNJ]

A certain company manufactures trucks. After the truck is built, its value is listed in inventory. If the truck is sold to a customer then the value of the truck is removed from inventor. Now if instead of buying the truck the customer leases the truck, is the value of the truck still included in the company's inventor?


Bob

 

[kirby]

No. The truck cost is no longer in inventory. It is no longer available for sale. Instead you now have a lease contract and have to follow lessor lease accounting rules. Depending on facts, it might be a direct financing lease or an operating lease.