Why Is the Salvage Value of an Asset Not Included

question 80

Multiple Choice

Why is the salvage value of an asset not included in the calculation of the present value of a lease?

• A) A leased asset always has salvage value of $0
• B) It is the same whether the asset is leased or purchased
• C) The salvage value would not be considered a cash flow
• D) The salvage value has to be estimated, and only cash flows whose values are known with certainty are included

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Definitions:

Stimulation

The act of provoking or causing a response in an organism, organ, or tissue through external or internal means.

Stimulation of the Senses

Refers to activities or interventions aimed at engaging one or more of the five senses (sight, sound, touch, taste, smell) for therapeutic, developmental, or experiential purposes.

Perception

The process by which individuals organize and interpret their sensory impressions to give meaning to their environment.

Field-Independent

Individuals who have the ability to identify and maintain an orientation not influenced by the surrounding context or field.