Major Procurement Methods Include

question 67

Multiple Choice

Major procurement methods include

• A) buying at an exchange or industrial mall.
• B) buying at private or public auction sites in which the organization participates as one of the buyers.
• C) buying directly from manufacturers, wholesalers, or retailers from their catalogs, and possibly by negotiation.
• D) all of the above.

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Definitions:

Operating Lease

A lease agreement allowing the use of an asset but does not convey rights similar to ownership of the asset.

Direct Financing Capital Lease

A lease agreement where the lessor purchases an asset and leases it out to the lessee, earning interest revenue over the lease term.

Implicit Rate

The interest rate implied in the terms of a lease, representing the lessor's yield if not explicitly stated.

Financing Income-Leases

Income generated from leasing out assets, under which the lessor retains ownership of the asset and provides the lessee the right to use it for a specific period.