Under FASB Rules, If a Lease Term Is Over 75

question 34

True/False

Under FASB rules, if a lease term is over 75% of the expected useful life of the leased asset, the lessee must classify this as an "operating" lease.

---

Definitions:

Documented

Something that is supported or proven by the presence of written information or records.

Honeymoon Phase

An initial period of enthusiasm or optimism in a new project, relationship, or situation.

Community

A group of people living in the same place or having a particular characteristic in common, or a feeling of fellowship with others sharing common attitudes, interests, and goals.

Disaster

A sudden event, such as an accident or a natural catastrophe, that causes great damage or loss of life.