If, as Part of the Accounting for a Lease, the Lessee

question 85

Multiple Choice

If, as part of the accounting for a lease, the lessee debits an asset and credits a liability, then the lease must be a(n) :

• A)purchased lease.
• B)operating lease.
• C)cancelable lease.
• D)capital lease.

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Definitions:

Buying And Selling

The basic actions of purchasing an asset and then selling it, fundamental processes in any market.

Operating Lease

A lease agreement allowing the use of an asset but does not convey rights of ownership of the asset.

Relatively Short

The term "relatively short" refers to a period of time that is short in comparison to other relevant timeframes or expectations.

Technological Changes

The overall process of invention, innovation, and diffusion of technology or processes.