When a sale and leaseback occurs under SFAS No.13
A)A gain or loss on the sale of the leased asset is deferred and amortized over the lease term.
B)A gain on sale of the leased asset is deferred and amortized over the lease term.
C)Whether a gain or loss on sale of the leased asset is deferred and amortized over the lease term depends on whether the lease is classified as a capital lease or an operating lease.
D)Both gains and losses are recognized in earnings when the asset is sold.

Question

Quizplus · Accepted Answer

Under SFAS No.13, a gain on the sale of the leased asset in a sale and leaseback transaction is deferred and amortized over the lease term.

When a Sale and Leaseback Occurs Under SFAS No