(CMA adapted, Dec 92 #10) There are many similarities between lessee and lessor accounting for the capitalization of leases.Which one of the following is a criterion for the capitalization of a lease by a lessee?
A)The lease transfers ownership of the property to the lessee by the end of the lease term.
B)The lease term is at least 90% of the remaining life of the asset at the beginning of the lease.
C)The present value of the minimum lease payments is 75% or more of the fair market value of the leased asset.
D)Future costs are reasonably predictable.
E)The lease term is at least 60% of the remaining life of the asset at the beginning of the lease.

Question

Quizplus · Accepted Answer

The criterion for capitalization of a lease by a lessee includes the transfer of ownership of the property to the lessee by the end of the lease term.

(CMA Adapted, Dec 92 #10) There Are Many Similarities Between