A lease with high payments early in its life which then decline to termination would:
A) provide greater cashflow to the lessee in the beginning years.
B) be evidence of tax avoidance and not acceptable to the CCRA.
C) be qualified as a capital lease under CICA3065.
D) provide a lower residual value and thus ensure a bargain-purchase price option.

Question

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The Answer of A lease with high payments early in its life which then decline to termination would:
A) provide greater cashflow to the lessee in the beginning years.
B) be evidence of tax avoidance and not acceptable to the CCRA.
C) be qualified as a capital lease under CICA3065.
D) provide a lower residual value and thus ensure a bargain-purchase price option.

A Lease with High Payments Early in Its Life Which