An agreement that specifies that the party owning the asset records a lease receivable for lease payments and earns interest on the financing is best described as a:

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A direct financing lease is a type of lease agreement where the lessor, who owns the asset, records a lease receivable for the lease payments and earns interest on the financing. This type of lease is common in the financing of equipment and vehicles, where the lessor does not aim to transfer ownership of the asset to the lessee at the end of the lease term but rather to earn interest on the financing provided.

An Agreement That Specifies That the Party Owning the Asset