Asset value

Could someone please elaborate as to how Fair value (Market value) is calculated, or if in this csae the Fair Value would be the Lessors Selling price? To classify as a sales-type lease, the fair value of the asset must be greater than the lessor’s book value. If not, it is accounted for as a direct-financing lease. Thanks

Fair value = PV of MLP. For sales type lease, Fair value > book value => Seller makes dealer profit on sale. For direct financing, fair value = book value ie no dealer profit.

Thanks Sumit