Purchase of asset with put option

All topics related to IFRS Standards.
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Anuradha13
Posts: 25
Joined: 28 Apr 2022, 11:47

Purchase of asset with put option

Post by Anuradha13 »

Hi All,

We buy the asset (purchase price 400000), paid in installment of 4000 monthly. Also we have a right to sell the asset back to the original seller at the price (400000-installments paid) at the end of 12 months and Original seller has the obligation to buy.

if we initially decide to sell - is this transaction considered as lease and recognise Right of use asset and lease liability ?

If we initially decide to retain the asset - can we capitalise the asset and show trade payables or it is financial liability if the payment is 4000 monthly for 100 months?



Thanks,
Anuradha
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