After years of discussion and contemplation, the Financial Accounting Standards Board (FASB) passed new lease accounting standards; so what does this mean for your business?
What are the current accounting standards used to account for leases?
Leases fall into one of two categories: capital leases or operating leases. Capital leases typically contain financing agreements similar to a sale and are accounted for as if the asset was purchased and long-term debt was incurred, whereas operating leases are similar to rental contracts and are not recorded in the balance sheet. Most construction contractors prefer operating leases because they are categorized as operating …read more
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