The incremental cash flows of leasing consider all of the following except the:
A) cost of the asset.
B) lease payment amount.
C) applicable tax rate.
D) lost annual depreciation expense.
E) cost of the operator for the leased asset.

Question

Quizplus · Accepted Answer

The incremental cash flows of leasing consider the cost of the asset, lease payment amount, applicable tax rate, and lost annual depreciation expense because they are all relevant factors in determining the financial feasibility of leasing. However, the cost of the operator for the leased asset is not considered in incremental cash flows because it is not directly related to the lease agreement and is typically a separate expense for the lessee.

The Incremental Cash Flows of Leasing Consider All of the Following