This TRAC lease example features a 3-year split TRAC lease for a Ford Focus valued at $16,100, with $189 monthly payments, a $10,955 residual value ($9,075 guaranteed, $1,880 unguaranteed), and a 4% borrowing rate. Under ASC 842, it is an operating lease capitalized at $6,422.91, with journal entries recording rent payments, liability reclassifications, and amortization. Year-end disclosures show $4,536 in future payments with a $4,366.85 present value. IFRS 16 classifies it as a finance lease, amortizing the asset straight-line and the liability via the effective interest method for compliance.

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