For Accounting Purposes, Which of the Following Conditions Would Not

question 39

Multiple Choice

For accounting purposes, which of the following conditions would not automatically cause a lease to be a financial lease?

• A) The lessee can purchase the asset for its fair market value at the end of the lease.
• B) The lease transfers ownership of the asset to the lessee by the end of the lease.
• C) The lease term is more than 75% of the asset's economic life.
• D) The PV of the lease payments is more than 90% of the asset's market value at lease inception.

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Definitions:

Neurons

Specialized neurons in the nervous system that communicate information via electrical and chemical signals.

Resting Potential

The electrical potential of a neuron when not stimulated or involved in passage of an impulse, typically around -70mV.

Axon

a part of a neuron that conducts impulses away from the cell body towards other neurons or muscles.

Electrical Charge

A fundamental property of matter that exists in either a positive or negative state and causes it to experience a force when placed in an electromagnetic field.