A sales-type lease differs from a direct financing lease in one respect:
A)The lessor receives a manufacturer's or dealer's profit.
B)The lessor receives more interest than on a direct financing lease.
C)The lessor receives less interest than on a direct financing lease.
D)The lessor uses a longer amortization period than on a direct financing lease.

Question

Quizplus · Accepted Answer

In a sales-type lease, the lessor (usually a manufacturer or dealer) receives a manufacturer's or dealer's profit, which is an additional amount on top of the interest earned on the lease. This is not the case in a direct financing lease, where the lessor only earns interest on the lease.

A Sales-Type Lease Differs from a Direct Financing Lease in One