A Lessor Enters into a Sales-Type Lease

question 34

Multiple Choice

A lessor enters into a sales-type lease.Which of the following statements is true if the leased asset has an unguaranteed residual value?

• A)The gross profit recognized is less than it would be if the residual was guaranteed.
• B)The gross profit recognized is more than it would be if the residual was guaranteed.
• C)The lessor should decrease the cost of goods sold by the amount of the unguaranteed residual value.
• D)The gross profit is the same as it would be if the residual was guaranteed.

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Definitions:

Z-score

A statistical measure that describes the position of a data point in terms of standard deviations from the mean.

Standard Normal Curve

A bell-shaped curve that represents the distribution of data in which the mean is 0 and the standard deviation is 1, used in statistics to represent theoretical distributions.

Z-score

An analytical indicator showing a value's position in relation to the average within a collection of values, expressed through its distance from the mean as measured in standard deviations.

Percentile

A value on a scale of one to a hundred that indicates the percent of a distribution that is equal to or below it.