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If Companies Want to Disqualify a Lease as a Finance

Question 49

Multiple Choice

If companies want to disqualify a lease as a finance lease to the lessee, while having the same lease qualify as a finance (sales or financing) lease to the lessor, which of the following are true?


A) It cannot be done
B) They must make information about the implicit rate unavailable to the lessee and use of the incremental borrowing rate by the lessee when it is higher than the implicit interest rate of the lessor.
C) They must include a bargain purchase option.
D) They must specify the transfer of the property to the lessee.

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