If an Asset Has a Positive Salvage of $1,000, Exactly

question 84

Multiple Choice

If an asset has a positive salvage of $1,000, exactly equal to UCC, then the lease analysis for an asset alone in its pool will show the following cash flows for that phenomenon.

• A)the salvage is a cost to leasing; there is no terminal loss or gain.
• B)the salvage is a cost of owning, the terminal loss is $1,000.
• C)salvage has no effect on leasing, since it belongs to the owner.
• D)the tax shelter for the terminal gain will be $1,000.

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Definitions:

Engine

A machine designed to convert one type of energy into mechanical energy, powering various devices, especially vehicles.

Primary Section

The initial or first part of a system, process, or document that precedes all others and usually contains fundamental components or information.

Ignition System

That part of a gasoline-powered engine that provides the heat to ignite the air-fuel mixture in the combustion chamber by sending a high-voltage spark through a spark plug gap.

Battery Voltage

The electric potential difference measured across the terminals of a battery, indicating the battery's charge state.