A Lease That Is Designed to Obtain Specific Accounting and Tax

question 58

Multiple Choice

A lease that is designed to obtain specific accounting and tax treatment is called a:

• A)sales-type lease.
• B)direct lease.
• C)sale and leaseback.
• D)leveraged lease.
• E)synthetic lease.

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Definitions:

Acceleration

A provision in a contract that allows a lender to demand immediate payment of the entire outstanding balance if certain conditions are not met.

Payment

The transfer of money or its equivalent in exchange for goods, services, or to settle a debt.

Time Certain

A specific point in time agreed upon at which an event must occur or a condition must be met.

Electronic Format

A form of data storage or presentation that uses digital technology, often allowing for easy sharing and manipulation of information.