Which of the Following Correctly Describes the Accounting for Leases

question 114

Multiple Choice

Which of the following correctly describes the accounting for leases?

• A)There are eight criteria used to establish whether the lessor maintains effective control of the leased asset.
• B)A lease asset and a lease liability are initially recognized for both a capital lease and an operating lease.
• C)If none of the criteria used to establish whether the lessor maintains effective control of the leased asset are met,then the lease is classified as a capital lease.
• D)The amount recorded as a lease asset and a lease liability is the sum of the required future lease payments.

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