Which of the following statements about leasing is correct?

Question

Quizplus · Accepted Answer

All the statements are correct regarding leasing. Approximately 30% of all equipment is leased, indicating the prevalence of leasing in acquiring equipment. Financial leases must indeed be capitalized on the balance sheet, reflecting the lessee's obligation to pay lease payments as well as the right to use the asset. Leased assets are depreciated over their useful life, similar to purchased assets, to account for their wear and tear. Lastly, lease obligations are amortized as loans, meaning the lease payments are spread out over the lease term, typically including interest and principal repayment components.

Which of the Following Statements About Leasing Is Correct