If the lease term is less than 12 months, you don't include the asset on your balance sheet. Lease payments are recorded as rental expenses.
However, if the lease runs for more than a year, you report the asset under Business Assets with a corresponding Liability. In this case, rent payments reduce the liability balance, with interest expense recorded separately. The Asset is depreciated as usual.
You can compute the interest expense by multiplying the applicable rate to the outstanding balance of your lease liability.
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