ABC INCLeased a New Machine from QRS on July 1, 2014

question 95

Multiple Choice

ABC INC.leased a new machine from QRS on July 1, 2014, under a lease with the following pertinent information: ABC INC.has the option to purchase the machine at the end of the lease term, by paying $40,000, which approximates the expected fair value of the machine on the option exercise date.The cost of the machine on QRS's accounting records is $150,000.On July 1, 2014, ABC INC.should record a net capitalized leased asset of:

• A)$178,500
• B)$190,000
• C)$150,000
• D)$189,300

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Definitions:

Oral

Referring to the initial stage of Freudian psychosexual development, during which the mouth is the primary source of pleasure and exploration.

Death Instinct

A concept in psychoanalytic theory referring to an unconscious drive toward decay, destruction, and death.

Libido

A term used to describe sexual desire or drive, often considered as an instinctual component of personality in psychoanalytic theory.

Psychosexual Stages

Freud’s theory of childhood development focusing on different parts of the body as primary sources of pleasure and conflicts at each stage.