An operating lease is one in which:
A) The lessee agrees to maintain the operating capability of the asset to a level specified by the lessor.
B) The risks and benefits of ownership reside with the lessor.
C) The lessee is required to maintain the leased asset according to an agreed maintenance schedule.
D) The risks and benefits of ownership reside with the lessor and the lessee is required to maintain the leased asset according to an agreed maintenance schedule.
E) None of the given answers.

Question

Quizplus · Accepted Answer

In an operating lease, the risks and benefits of ownership reside with the lessor. This means that the lessor is responsible for any maintenance, repairs, or replacement of the leased asset. The lessee simply pays a rental fee to use the asset for a specific period of time.

An Operating Lease Is One in Which