"Consideration" Requires an Actual Benefit to Both Sides of an Agreement

question 57

True/False

"Consideration" requires an actual benefit to both sides of an agreement.

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Definitions:

Useful Life

Useful life is the estimated duration of time that an asset is expected to be functional and economically viable for its intended purpose.

Lease Term

The fixed, non-cancellable period during which a lessee has the right to use an asset, with the option for renewal under specific conditions.

Operating Lease

A contract allowing for the use of an asset without ownership, generally resulting in periodic lease payments and not recorded on the lessee's balance sheet under certain conditions.

Capital Lease

A lease agreement that is classified as a purchase by the lessee for accounting purposes, based on criteria such as ownership transfer or a bargain purchase option.