A Company Leases an Asset for a 7-Year Period Under

question 90

Multiple Choice

A company leases an asset for a 7-year period under a capital lease and agrees to pay an annual rental of $15,000. The initial entry to record this transaction, assuming the present value of the lease payments is $84,000, would include

• A) Debit to Lease Expense for $15,000
• B) Debit to Lease Expense for $12,000
• C) Debit to Lease Asset for $84,000
• D) Credit to Lease Liability for $12,000

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Definitions:

Claustrophobia

An anxiety disorder characterized by an irrational fear of being in enclosed or confined spaces, resulting in panic attacks or avoidance behavior.

Infrared Light

Electromagnetic radiation with wavelengths longer than visible light but shorter than microwaves, often used in heating, night vision equipment, and remote controls.

Brain

The organ in the head that controls thought, memory, feelings, and activity.

fNIRS

Functional Near-Infrared Spectroscopy, a neuroimaging method used to measure brain activity based on hemodynamic responses.