The Term "Net Advantage to Leasing" Is Defined As

question 147

Multiple Choice

The term "net advantage to leasing" is defined as:

• A) The NPV of the decision to lease an asset instead of buying it.
• B) The after-tax cash flows received from a lessee.
• C) The after-tax benefit to a lessor of an asset.
• D) The incremental sales by a manufacturer based on its leasing operations.
• E) The future value of the incremental cash flows received from a lessee.

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Definitions:

Operating Activities

Business actions that relate to the day-to-day operations, producing revenue and spending money to operate the business.

Accounts Receivable

Financial obligations of customers to a firm for received goods or services that have not been paid for.

Merchandise Inventory

The collection of goods a company has in stock and available for sale to customers.

Accounts Receivable

Funds that customers owe to a business for products or services that have been provided but remain unpaid.