A Lessor with a Sales-Type Lease Involving an Unguaranteed Residual

question 112

Multiple Choice

A lessor with a sales-type lease involving an unguaranteed residual value available to the lessor at the end of the lease term will report sales revenue in the period of inception of the lease at which of the following amounts?

• A) The minimum lease payments plus the unguaranteed residual value.
• B) The present value of the minimum lease payments.
• C) The cost of the asset to the lessor, less the present value of any unguaranteed residual value.
• D) The present value of the minimum lease payments plus the present value of the unguaranteed residual value.

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Definitions:

Advertising Wear Out

The decline in audience response as a result of repeated exposure to the same advertisement over time.

Simple Repetition

The process of repeating something multiple times in order to learn or memorize it, often used as a basic study or advertising technique.

Repetition With Variation

Repeating the same information, but in a varied format.

March of Dimes

An American nonprofit organization that works to improve the health of mothers and babies by preventing birth defects, premature birth, and infant mortality.