ASC 842 accounting for a warehouse lease
Warehouse and industrial property leases behave like other real estate: long-term operating leases, monthly in advance, often with initial direct costs such as broker commissions.
Typical term: 96 months (~8 yr)Paid in advance
How to account for it
What to watch for on a warehouse lease
Capitalise initial direct costs — broker commissions and legal fees directly attributable to obtaining the lease — into the ROU asset. The engine adds them to the asset at commencement.
Worked example
No account neededA warehouse lease, computed live
This calculator is pre-loaded with a representative warehouse lease. Change any field to match your lease — the present value, right-of-use asset, lease liability, schedule and disclosures recompute instantly.
ASC 842 · 96 periods · commencing Jan 1, 2026
Initial lease liability
$1,106,631.44
PV of lease payments
Right-of-use asset
$1,126,631.44
At commencement
Total lease cost
$1,460,000.00
Over the full term
Straight-line cost
$15,208.33
Per period
| # | Date | Payment | Interest | Principal | Liability | ROU amort. | ROU asset |
|---|---|---|---|---|---|---|---|
| 1 | Jan 1, 2026 | $15,000.00 | $6,367.85 | $8,632.15 | $1,097,999.29 | $8,840.48 | $1,117,790.96 |
| 2 | Feb 1, 2026 | $15,000.00 | $6,317.50 | $8,682.50 | $1,089,316.79 | $8,890.83 | $1,108,900.13 |
| 3 | Mar 1, 2026 | $15,000.00 | $6,266.85 | $8,733.15 | $1,080,583.64 | $8,941.48 | $1,099,958.65 |
| 4 | Apr 1, 2026 | $15,000.00 | $6,215.90 | $8,784.10 | $1,071,799.54 | $8,992.43 | $1,090,966.22 |
| 5 | May 1, 2026 | $15,000.00 | $6,164.66 | $8,835.34 | $1,062,964.20 | $9,043.67 | $1,081,922.55 |
| 6 | Jun 1, 2026 | $15,000.00 | $6,113.13 | $8,886.87 | $1,054,077.33 | $9,095.20 | $1,072,827.35 |
| 7 | Jul 1, 2026 | $15,000.00 | $6,061.28 | $8,938.72 | $1,045,138.61 | $9,147.05 | $1,063,680.30 |
| 8 | Aug 1, 2026 | $15,000.00 | $6,009.15 | $8,990.85 | $1,036,147.76 | $9,199.18 | $1,054,481.12 |
| 9 | Sep 1, 2026 | $15,000.00 | $5,956.69 | $9,043.31 | $1,027,104.45 | $9,251.64 | $1,045,229.48 |
| 10 | Oct 1, 2026 | $15,000.00 | $5,903.94 | $9,096.06 | $1,018,008.39 | $9,304.39 | $1,035,925.09 |
| 11 | Nov 1, 2026 | $15,000.00 | $5,850.89 | $9,149.11 | $1,008,859.28 | $9,357.44 | $1,026,567.65 |
| 12 | Dec 1, 2026 | $15,000.00 | $5,797.51 | $9,202.49 | $999,656.79 | $9,410.82 | $1,017,156.83 |
| 13 | Jan 1, 2027 | $15,000.00 | $5,743.83 | $9,256.17 | $990,400.62 | $9,464.50 | $1,007,692.33 |
| 14 | Feb 1, 2027 | $15,000.00 | $5,689.84 | $9,310.16 | $981,090.46 | $9,518.49 | $998,173.84 |
| 15 | Mar 1, 2027 | $15,000.00 | $5,635.52 | $9,364.48 | $971,725.98 | $9,572.81 | $988,601.03 |
| 16 | Apr 1, 2027 | $15,000.00 | $5,580.91 | $9,419.09 | $962,306.89 | $9,627.42 | $978,973.61 |
| 17 | May 1, 2027 | $15,000.00 | $5,525.95 | $9,474.05 | $952,832.84 | $9,682.38 | $969,291.23 |
| 18 | Jun 1, 2027 | $15,000.00 | $5,470.69 | $9,529.31 | $943,303.53 | $9,737.64 | $959,553.59 |
| 19 | Jul 1, 2027 | $15,000.00 | $5,415.11 | $9,584.89 | $933,718.64 | $9,793.22 | $949,760.37 |
| 20 | Aug 1, 2027 | $15,000.00 | $5,359.19 | $9,640.81 | $924,077.83 | $9,849.14 | $939,911.23 |
| 21 | Sep 1, 2027 | $15,000.00 | $5,302.95 | $9,697.05 | $914,380.78 | $9,905.38 | $930,005.85 |
| 22 | Oct 1, 2027 | $15,000.00 | $5,246.39 | $9,753.61 | $904,627.17 | $9,961.94 | $920,043.91 |
| 23 | Nov 1, 2027 | $15,000.00 | $5,189.49 | $9,810.51 | $894,816.66 | $10,018.84 | $910,025.07 |
| 24 | Dec 1, 2027 | $15,000.00 | $5,132.27 | $9,867.73 | $884,948.93 | $10,076.06 | $899,949.01 |
| 25 | Jan 1, 2028 | $15,000.00 | $5,074.70 | $9,925.30 | $875,023.63 | $10,133.63 | $889,815.38 |
| 26 | Feb 1, 2028 | $15,000.00 | $5,016.80 | $9,983.20 | $865,040.43 | $10,191.53 | $879,623.85 |
| 27 | Mar 1, 2028 | $15,000.00 | $4,958.57 | $10,041.43 | $854,999.00 | $10,249.76 | $869,374.09 |
| 28 | Apr 1, 2028 | $15,000.00 | $4,900.00 | $10,100.00 | $844,899.00 | $10,308.33 | $859,065.76 |
| 29 | May 1, 2028 | $15,000.00 | $4,841.08 | $10,158.92 | $834,740.08 | $10,367.25 | $848,698.51 |
| 30 | Jun 1, 2028 | $15,000.00 | $4,781.81 | $10,218.19 | $824,521.89 | $10,426.52 | $838,271.99 |
| 31 | Jul 1, 2028 | $15,000.00 | $4,722.21 | $10,277.79 | $814,244.10 | $10,486.12 | $827,785.87 |
| 32 | Aug 1, 2028 | $15,000.00 | $4,662.26 | $10,337.74 | $803,906.36 | $10,546.07 | $817,239.80 |
| 33 | Sep 1, 2028 | $15,000.00 | $4,601.95 | $10,398.05 | $793,508.31 | $10,606.38 | $806,633.42 |
| 34 | Oct 1, 2028 | $15,000.00 | $4,541.30 | $10,458.70 | $783,049.61 | $10,667.03 | $795,966.39 |
| 35 | Nov 1, 2028 | $15,000.00 | $4,480.29 | $10,519.71 | $772,529.90 | $10,728.04 | $785,238.35 |
| 36 | Dec 1, 2028 | $15,000.00 | $4,418.93 | $10,581.07 | $761,948.83 | $10,789.40 | $774,448.95 |
| 37 | Jan 1, 2029 | $15,000.00 | $4,357.20 | $10,642.80 | $751,306.03 | $10,851.13 | $763,597.82 |
| 38 | Feb 1, 2029 | $15,000.00 | $4,295.12 | $10,704.88 | $740,601.15 | $10,913.21 | $752,684.61 |
| 39 | Mar 1, 2029 | $15,000.00 | $4,232.67 | $10,767.33 | $729,833.82 | $10,975.66 | $741,708.95 |
| 40 | Apr 1, 2029 | $15,000.00 | $4,169.86 | $10,830.14 | $719,003.68 | $11,038.47 | $730,670.48 |
| 41 | May 1, 2029 | $15,000.00 | $4,106.69 | $10,893.31 | $708,110.37 | $11,101.64 | $719,568.84 |
| 42 | Jun 1, 2029 | $15,000.00 | $4,043.15 | $10,956.85 | $697,153.52 | $11,165.18 | $708,403.66 |
| 43 | Jul 1, 2029 | $15,000.00 | $3,979.23 | $11,020.77 | $686,132.75 | $11,229.10 | $697,174.56 |
| 44 | Aug 1, 2029 | $15,000.00 | $3,914.94 | $11,085.06 | $675,047.69 | $11,293.39 | $685,881.17 |
| 45 | Sep 1, 2029 | $15,000.00 | $3,850.27 | $11,149.73 | $663,897.96 | $11,358.06 | $674,523.11 |
| 46 | Oct 1, 2029 | $15,000.00 | $3,785.24 | $11,214.76 | $652,683.20 | $11,423.09 | $663,100.02 |
| 47 | Nov 1, 2029 | $15,000.00 | $3,719.82 | $11,280.18 | $641,403.02 | $11,488.51 | $651,611.51 |
| 48 | Dec 1, 2029 | $15,000.00 | $3,654.02 | $11,345.98 | $630,057.04 | $11,554.31 | $640,057.20 |
| 49 | Jan 1, 2030 | $15,000.00 | $3,587.83 | $11,412.17 | $618,644.87 | $11,620.50 | $628,436.70 |
| 50 | Feb 1, 2030 | $15,000.00 | $3,521.26 | $11,478.74 | $607,166.13 | $11,687.07 | $616,749.63 |
| 51 | Mar 1, 2030 | $15,000.00 | $3,454.31 | $11,545.69 | $595,620.44 | $11,754.02 | $604,995.61 |
| 52 | Apr 1, 2030 | $15,000.00 | $3,386.95 | $11,613.05 | $584,007.39 | $11,821.38 | $593,174.23 |
| 53 | May 1, 2030 | $15,000.00 | $3,319.21 | $11,680.79 | $572,326.60 | $11,889.12 | $581,285.11 |
| 54 | Jun 1, 2030 | $15,000.00 | $3,251.07 | $11,748.93 | $560,577.67 | $11,957.26 | $569,327.85 |
| 55 | Jul 1, 2030 | $15,000.00 | $3,182.54 | $11,817.46 | $548,760.21 | $12,025.79 | $557,302.06 |
| 56 | Aug 1, 2030 | $15,000.00 | $3,113.60 | $11,886.40 | $536,873.81 | $12,094.73 | $545,207.33 |
| 57 | Sep 1, 2030 | $15,000.00 | $3,044.26 | $11,955.74 | $524,918.07 | $12,164.07 | $533,043.26 |
| 58 | Oct 1, 2030 | $15,000.00 | $2,974.52 | $12,025.48 | $512,892.59 | $12,233.81 | $520,809.45 |
| 59 | Nov 1, 2030 | $15,000.00 | $2,904.38 | $12,095.62 | $500,796.97 | $12,303.95 | $508,505.50 |
| 60 | Dec 1, 2030 | $15,000.00 | $2,833.81 | $12,166.19 | $488,630.78 | $12,374.52 | $496,130.98 |
| 61 | Jan 1, 2031 | $15,000.00 | $2,762.85 | $12,237.15 | $476,393.63 | $12,445.48 | $483,685.50 |
| 62 | Feb 1, 2031 | $15,000.00 | $2,691.46 | $12,308.54 | $464,085.09 | $12,516.87 | $471,168.63 |
| 63 | Mar 1, 2031 | $15,000.00 | $2,619.66 | $12,380.34 | $451,704.75 | $12,588.67 | $458,579.96 |
| 64 | Apr 1, 2031 | $15,000.00 | $2,547.45 | $12,452.55 | $439,252.20 | $12,660.88 | $445,919.08 |
| 65 | May 1, 2031 | $15,000.00 | $2,474.80 | $12,525.20 | $426,727.00 | $12,733.53 | $433,185.55 |
| 66 | Jun 1, 2031 | $15,000.00 | $2,401.74 | $12,598.26 | $414,128.74 | $12,806.59 | $420,378.96 |
| 67 | Jul 1, 2031 | $15,000.00 | $2,328.26 | $12,671.74 | $401,457.00 | $12,880.07 | $407,498.89 |
| 68 | Aug 1, 2031 | $15,000.00 | $2,254.33 | $12,745.67 | $388,711.33 | $12,954.00 | $394,544.89 |
| 69 | Sep 1, 2031 | $15,000.00 | $2,179.98 | $12,820.02 | $375,891.31 | $13,028.35 | $381,516.54 |
| 70 | Oct 1, 2031 | $15,000.00 | $2,105.20 | $12,894.80 | $362,996.51 | $13,103.13 | $368,413.41 |
| 71 | Nov 1, 2031 | $15,000.00 | $2,029.98 | $12,970.02 | $350,026.49 | $13,178.35 | $355,235.06 |
| 72 | Dec 1, 2031 | $15,000.00 | $1,954.32 | $13,045.68 | $336,980.81 | $13,254.01 | $341,981.05 |
| 73 | Jan 1, 2032 | $15,000.00 | $1,878.22 | $13,121.78 | $323,859.03 | $13,330.11 | $328,650.94 |
| 74 | Feb 1, 2032 | $15,000.00 | $1,801.68 | $13,198.32 | $310,660.71 | $13,406.65 | $315,244.29 |
| 75 | Mar 1, 2032 | $15,000.00 | $1,724.69 | $13,275.31 | $297,385.40 | $13,483.64 | $301,760.65 |
| 76 | Apr 1, 2032 | $15,000.00 | $1,647.25 | $13,352.75 | $284,032.65 | $13,561.08 | $288,199.57 |
| 77 | May 1, 2032 | $15,000.00 | $1,569.35 | $13,430.65 | $270,602.00 | $13,638.98 | $274,560.59 |
| 78 | Jun 1, 2032 | $15,000.00 | $1,491.01 | $13,508.99 | $257,093.01 | $13,717.32 | $260,843.27 |
| 79 | Jul 1, 2032 | $15,000.00 | $1,412.21 | $13,587.79 | $243,505.22 | $13,796.12 | $247,047.15 |
| 80 | Aug 1, 2032 | $15,000.00 | $1,332.95 | $13,667.05 | $229,838.17 | $13,875.38 | $233,171.77 |
| 81 | Sep 1, 2032 | $15,000.00 | $1,253.22 | $13,746.78 | $216,091.39 | $13,955.11 | $219,216.66 |
| 82 | Oct 1, 2032 | $15,000.00 | $1,173.04 | $13,826.96 | $202,264.43 | $14,035.29 | $205,181.37 |
| 83 | Nov 1, 2032 | $15,000.00 | $1,092.37 | $13,907.63 | $188,356.80 | $14,115.96 | $191,065.41 |
| 84 | Dec 1, 2032 | $15,000.00 | $1,011.25 | $13,988.75 | $174,368.05 | $14,197.08 | $176,868.33 |
| 85 | Jan 1, 2033 | $15,000.00 | $929.65 | $14,070.35 | $160,297.70 | $14,278.68 | $162,589.65 |
| 86 | Feb 1, 2033 | $15,000.00 | $847.57 | $14,152.43 | $146,145.27 | $14,360.76 | $148,228.89 |
| 87 | Mar 1, 2033 | $15,000.00 | $765.01 | $14,234.99 | $131,910.28 | $14,443.32 | $133,785.57 |
| 88 | Apr 1, 2033 | $15,000.00 | $681.98 | $14,318.02 | $117,592.26 | $14,526.35 | $119,259.22 |
| 89 | May 1, 2033 | $15,000.00 | $598.45 | $14,401.55 | $103,190.71 | $14,609.88 | $104,649.34 |
| 90 | Jun 1, 2033 | $15,000.00 | $514.45 | $14,485.55 | $88,705.16 | $14,693.88 | $89,955.46 |
| 91 | Jul 1, 2033 | $15,000.00 | $429.95 | $14,570.05 | $74,135.11 | $14,778.38 | $75,177.08 |
| 92 | Aug 1, 2033 | $15,000.00 | $344.95 | $14,655.05 | $59,480.06 | $14,863.38 | $60,313.70 |
| 93 | Sep 1, 2033 | $15,000.00 | $259.47 | $14,740.53 | $44,739.53 | $14,948.86 | $45,364.84 |
| 94 | Oct 1, 2033 | $15,000.00 | $173.48 | $14,826.52 | $29,913.01 | $15,034.85 | $30,329.99 |
| 95 | Nov 1, 2033 | $15,000.00 | $86.99 | $14,913.01 | $15,000.00 | $15,121.34 | $15,208.65 |
| 96 | Dec 1, 2033 | $15,000.00 | $0.00 | $15,000.00 | $0.00 | $15,208.65 | $0.00 |
Citations & method
- • ASC 842-20-30-1 — initial measurement of the lease liability at the present value of lease payments.
- • ASC 842-20-30-5 — the right-of-use asset comprises the initial liability, prepaid lease payments and initial direct costs, less lease incentives received.
- • ASC 842-20-25-6 — a single lease cost is recognised on a straight-line basis over the lease term for an operating lease.
- • ASC 842-10-25-2 — the five criteria for finance-lease classification.
- • ASC 842-20-50 — quantitative disclosure requirements (weighted-average term/rate, maturity analysis).
- Discount rate applied as a nominal monthly rate: 7.000% ÷ periods-per-year.
- Payments treated as made in advance (annuity-due): each period's payment is applied before interest accretes.
- Operating lease: total lease cost is straight-lined; the ROU asset amortizes as the plug between straight-line cost and interest.
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