If an Asset Is Leased, the Lessee

If an asset is leased, the lessee:

A) Receives a tax deduction equal to the lease payment.
B) Receives a tax deduction equal to the annual depreciation.
C) Has an initial cash outflow equal to the cost of the equipment.
D) Benefits from the depreciation tax shield, thereby paying less tax.
E) Most likely has a tax rate that is higher than the tax rate of the lessor.