Based solely upon the following sets of circumstances indicated below, which set gives rise to a sales-type or direct-financing lease of a lessor?
$\begin{array}{cccc}
\text {Transfers Ownership} &\text {Contains Bargain }&\text {Collectibility of Lease}&\text {Any Important }\
\text {By End Of Lease?}&\text {Purchase Option?}&\text {Payments Assured?}&\text {Uncertainties?} \\end{array}$
A)$\begin{array}{cccc}&&& \text {No }&&&&&&& \text {Yes }&&&&&&&& \text {Yes} &&&&&&&\text { No} \\end{array}$
B)$\begin{array}{cccc}&&& \text {Yes }&&&&&&&\text { No }&&&&&&&& \text {No }&&&&&&&\text { No} \\end{array}$
C)$\begin{array}{cccc}&&& \text {Yes }&&&&&&& \text {No }&&&&&&&&& \text {No }&&&&&&\text { Yes} \\end{array}$
D)$\begin{array}{cccc}&&&\text { No} &&&&&&& \text {Yes} &&&&&&&&& \text {Yes} &&&&&& \text {Yes} \
\end{array}$

Question

Based solely upon the following sets of circumstances indicated below, which set gives rise to a sales-type or direct-financing lease of a lessor? 
$\begin{array}{cccc}
\text {Transfers Ownership} &\text {Contains Bargain }&\text {Collectibility of Lease}&\text {Any Important }\
\text {By End Of Lease?}&\text {Purchase Option?}&\text {Payments Assured?}&\text {Uncertainties?} \\end{array}$
A)$\begin{array}{cccc}&&& \text {No }&&&&&&& \text {Yes }&&&&&&&& \text {Yes} &&&&&&&\text { No} \\end{array}$
B)$\begin{array}{cccc}&&& \text {Yes }&&&&&&&\text { No }&&&&&&&& \text {No }&&&&&&&\text { No} \\end{array}$
C)$\begin{array}{cccc}&&& \text {Yes }&&&&&&& \text {No }&&&&&&&&& \text {No }&&&&&&\text { Yes} \\end{array}$
D)$\begin{array}{cccc}&&&\text { No} &&&&&&& \text {Yes} &&&&&&&&& \text {Yes} &&&&&& \text {Yes} \
\end{array}$

Quizplus · Accepted Answer

For a lease to be classified as a sales-type or direct-financing lease by the lessor, certain criteria must be met, such as the collectibility of lease payments being reasonably assured and there being no important uncertainties regarding additional costs yet to be incurred by the lessor. Option A meets these conditions.

Based Solely Upon the Following Sets of Circumstances Indicated Below