CERTYNEX IFRS ACADEMY

Orvane, a lessor, has classified a lease of medical equipment as a finance lease. On what pattern does it recognise finance income over the lease term?

In equal parts each year: the total finance income expected under the contract is divided by the number of years in the lease term.

On a pattern reflecting a constant periodic rate of return on its net investment.

Equal to the amount of lease payments collected in each period.

In full at the commencement date, since the contract is treated as a sale.