Which One of These Is Considered to Be the Best

question 41

Multiple Choice

Which one of these is considered to be the best reason for obtaining a capital lease?

• A) To benefit from the implicit interest rate of a lease
• B) To extend payments over a period of time
• C) To avoid the restrictive covenants often found in loan agreements
• D) To reduce the liabilities shown on the firm's balance sheet
• E) To obtain 100 percent financing

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