A capital (or "financing") lease usually calls for an annual expense deduction equal to the lease payment.
This is more indicative of an "operating" lease.

Question

Quizplus · Accepted Answer

A capital lease is typically considered a long-term financing arrangement, while an operating lease is considered a short-term rental agreement. Under a capital lease, the lessee usually receives ownership of the leased asset at the end of the lease term, and the lease payments represent both interest and principal payments on the financing. As a result, the annual expense deduction for a capital lease would typically be comprised of both interest and depreciation expenses, not just the lease payment.

A Capital (Or "Financing") Lease Usually Calls for an Annual