Which One of the Following Is an Indicator That a Lease

question 45

Multiple Choice

Which one of the following is an indicator that a lease is an operating lease for accounting purposes?

• A) The lease transfers ownership of the asset to the lessee by the end of the lease term.
• B) The lessee will probably exercise the option to purchase the leased asset.
• C) The lease term represents a minor portion of the leased asset's economic life.
• D) The residual value plus the present value of the lease payments exceeds the value of the leased asset.
• E) The lessor has no use for the asset other than to lease it to the present lessee due to the specialized nature of that asset.

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Definitions:

Orally Fixated Person

An individual who retains an infantile tendency to focus on oral activities, such as eating or talking, as identified in psychoanalytic theory.

Sloppy Dresser

An informal term describing someone who dresses in an unkempt or careless fashion, often disregarding social norms for dress.

Smoke

The visible vapor and gases emitted when a substance burns, often carrying suspended particles and toxic substances.

Sublimation

A defense mechanism in psychoanalytic theory where socially unacceptable impulses or idealizations are unconsciously transformed into socially acceptable actions or behaviors.