Which of the following criteria is essential for a lease to be recognised as a finance lease?
A) It must be cancellable.
B) The lease term is for 75 per cent or more of the useful life of the asset.
C) The present value of the lease payments equals or exceeds 90 per cent of the fair value of the leased asset to the lessor.
D) Substantially all the risks and benefits of the asset are effectively transferred from the lessor to the lessee.
Correct Answer:
Verified
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