Which of the Following Lease Provisions Would Cause a Lease

question 71

Multiple Choice

Which of the following lease provisions would cause a lease to be classified as an operating lease?

• A)The lease contains a bargain purchase option.
• B)The collectability of lease payments by the lessor is unpredictable.
• C)The term of the lease is more than 75 percent of the estimated economic life of the leased property.
• D)The present value of the minimum lease payments equals or exceeds 90 percent of the fair value of the leased property.

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Definitions:

Competitive People

Individuals who have a strong desire to win or be the best in their field, often driving them to put in significant effort and perseverance.

Personal Gains

Benefits or advantages gained by an individual, often from a situation or through their actions, which can be material or immaterial.

Encouraging Behavior

Actions intended to support, motivate, or promote confidence in individuals or groups.

Challenger

An entity or individual that questions, competes against, or provides alternatives to the current status quo or dominant players.