The FASB defines financial lease as leases that meet the following:
A) The lease agreement transfers ownership to the lessee before the lease expires, or the lessee can purchase the asset for a bargain price when the lease expires.
B) The lease agreement transfers ownership to the lessee before the lease expires or the lessee can purchase the asset for a bargain price when the lease expires, or the lease lasts for at least 75 percent of the asset's estimated economic life.
C) The lease agreement transfers ownership to the lessee before the lease expires, or the lessee can purchase the asset for a bargain price when the lease expires, or the lease lasts for at least 75 percent of the asset's estimated economic life, or the present value of the lease payments is at least 90 percent of the asset's value.
D) The lessee can purchase the asset for a bargain price when the lease expires, or the lease lasts for at least 75 percent of the asset's estimated economic life, or the present value of the lease payments is at least 90 percent of the asset's value.
Correct Answer:
Verified
Q2: Which of the following statements is not
Q5: Sale and lease-back arrangements are prevalent in
A)aircraft.
B)computers.
C)real
Q6: If the after-tax lease payment per year
Q6: The following are advantages to lessors over
Q7: The following are sensible reasons for leasing:
A)Short-term
Q9: A lease payment can be thought of
Q10: The following are sensible reasons for leasing:
A)Maintenance
Q13: Leveraged leases are a form of
A)operating leases.
B)financial
Q14: If the lessor borrows most of the
Q17: In a lease arrangement, the user of
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents