USA Fixed / Leased Assets

Jul 24, 2020
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United States
My company offers services for ATM Machines where some customers buy the machines outright but we also have agreements where we share on the revenue earned at that location. The agreement is usually for 5 years but they still own the machine. My question is regarding if we should book this revenue to deferred revenue and spread it over 5 years or recognize in full in one month? Having said that, this would also mean we would capitalize the assets.

I am trying to understand if we should be accounting for these as leased assets as they ownership does not revert back to the company.

My logic says these assets should be a sale, but maybe I am missing something.

Thanks for your help.



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May 12, 2011
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United States
Since you are working at a leasing company, you should get yourself educated in accounting for leases. There are many resources on the internet. Just google “accounting for leases”.

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