A lease that is designed to obtain specific accounting and tax treatment is called a:
A)sales-type lease.
B)direct lease.
C)sale and leaseback.
D)leveraged lease.
E)synthetic lease.

Question

Quizplus · Accepted Answer

A synthetic lease is designed to obtain specific accounting and tax treatment, as it is structured to appear as an operating lease for accounting purposes while being treated as a loan for tax purposes. The other leasing options listed do not necessarily have this specific goal in mind.

A Lease That Is Designed to Obtain Specific Accounting and Tax