Which One of the Following Statements Is Correct Concerning an Operating

question 186

Multiple Choice

Which one of the following statements is correct concerning an operating lease?

• A) The leased asset will have a significant residual value at the end of the lease term.
• B) The lease will be recorded as a capital lease on the balance sheet of the lessee.
• C) The lessor can terminate the lease at any time without penalty.
• D) The lease term is generally equal to the economic life of the leased asset.
• E) The lessee is responsible for the maintenance and insurance related to the leased asset.

---

Definitions:

Overactivity

Excessive levels of activity or movement, which can be physical or mental.

Hallucinations

Sensory perceptions that appear real but are created by the mind, without an external stimulus, affecting any of the five senses.

Disorganized Thinking

A state where an individual's thoughts are chaotic, unclear, or not logically connected, often manifesting in speech and behavior.

Schizophrenia

A chronic and severe mental disorder that affects how a person thinks, feels, and behaves, characterized by delusions, hallucinations, and impaired functioning.