Which one of the following statements is correct concerning taxes and leasing?
A)Tax-deferral is a legitimate reason for leasing.
B)The lessee should be the party with the higher tax bracket.
C)Generally speaking, lessors tend to benefit from leases while lessees do not.
D)If a firm has significant net operating losses, it should be the lessor in a lease.
E)You should only lease an asset if the lease will be fully amortized.

Question

Quizplus · Accepted Answer

Tax-deferral is a legitimate reason for leasing as it allows the lessee to allocate a smaller amount of money toward tax payments each year, giving them more money to invest in other areas of their business.

Which One of the Following Statements Is Correct Concerning Taxes