Which Statement Is Correct

question 75

Multiple Choice

Which statement is correct?

• A)In a finance lease,the lessee uses the asset for only a short fraction of the asset's useful life.
• B)The lessee expenses the cost of the lease in the period the benefits are received in a finance lease.
• C)A finance lease transfers the risks and rewards from the lessee to the lessor.
• D)In a finance lease,the lessee records an asset for the property being used.

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Definitions:

Net Income

The net income a firm retains after deducting all operational expenses and taxes from its gross revenue.

Net Cash

The amount of cash available after adjusting for cash inflows and outflows over a given period.

Financing Activities

Transactions and events that involve raising funds for the company and repaying funds to investors, such as issuing stock or borrowing.

Cash Dividend

A payment made by a company out of its profits to shareholders in the form of cash.