In a direct financing lease, the lessor's carrying value of the leased asset is less than its fair value.

Name: In a direct financing lease, the lessor's carrying value of the leased asset is less than its fair value.
Brand: Quizplus
Rating: 4.8 (44 reviews)

Question

Quizplus · Accepted Answer

In a direct financing lease, the lessor's carrying value of the leased asset is equal to its fair value at the inception of the lease, as the lessor essentially finances the asset for the lessee and recognizes interest income over the lease term.

In a Direct Financing Lease, the Lessor's Carrying Value of the Leased