All of the following statements regarding leases are true except:
A)For a finance lease,the lessee records the leased item as its own asset.
B)For a finance lease,the lessee amortizes the right-of-use asset acquired under the lease.
C)Finance leases create a liability on the balance sheet.
D)Finance leases do not transfer ownership of the asset under the lease,but operating leases often do.
E)For a short-term lease of a few days or weeks,the lessee records payments as rental expense.

Question

Quizplus · Accepted Answer

Finance leases often transfer ownership of the asset to the lessee by the end of the lease term, or provide an option to purchase the asset at a bargain price, distinguishing them from operating leases which typically do not transfer ownership.

All of the Following Statements Regarding Leases Are True Except