A Lessor Enters into a Sales-Type Lease

question 34

Multiple Choice

A lessor enters into a sales-type lease.Which of the following statements is true if the leased asset has an unguaranteed residual value?

• A)The gross profit recognized is less than it would be if the residual was guaranteed.
• B)The gross profit recognized is more than it would be if the residual was guaranteed.
• C)The lessor should decrease the cost of goods sold by the amount of the unguaranteed residual value.
• D)The gross profit is the same as it would be if the residual was guaranteed.

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Definitions:

Recruiting Process

The series of actions taken by an organization to identify and hire the best candidates for open positions.

Pre-employment Physical Examination

A health check performed before hiring a candidate to ensure they are physically capable of performing the duties of a job.

Employment Offer

A formal proposal by an employer to a candidate outlining the terms and conditions of employment.

Recruitment

The process of attracting, screening, and selecting qualified people for a job at an organization or firm.