Cash and Cash Equivalents

Lessor accounting under ASC 842 is tested less often than lessee, but when it appears it's usually a sim asking you to classify and set up the lease. The AICPA trap: candidates confuse sales-type vs. direct financing — if the lease transfers substantially all risks and rewards AND the lessor is the manufacturer/dealer, it's sales-type (recognize profit at commencement). Direct financing defers the profit. Know the classification criteria before you touch the numbers.