Kate is leasing some equipment from Ajax Leasing for a period of one-year.Ajax pays the maintenance,taxes,and insurance costs for this equipment.The life of the equipment is 7 years.Which type of lease does Kate have?
A)open
B)straight
C)operating
D)financial
E)tax-oriented

Question

Quizplus · Accepted Answer

Kate has an operating lease. In this type of lease, the lessor (Ajax Leasing) is responsible for maintenance, taxes, and insurance costs. The lessee (Kate) does not have ownership of the equipment and returns it to the lessor at the end of the lease term. This type of lease is generally short-term and does not result in ownership transfer.

Kate Is Leasing Some Equipment from Ajax Leasing for a Period