Based upon the standards issued by CICA, a financial lease must be capitalized if the lease term is 75% or more of the estimated economic life of the asset.

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According to the Canadian Institute of Chartered Accountants (CICA) Handbook, a lease should be capitalized if the lease term is for the major part of the economic life of the asset, often interpreted as 75% or more, among other criteria.

Based Upon the Standards Issued by CICA, a Financial Lease