Which of the Following Statements Pertaining to Lease Accounting Is

question 89

Multiple Choice

Which of the following statements pertaining to lease accounting is not correct?

• A)The lessee will depreciate a leased asset either over the lease term or the leased asset's useful life dependent upon which of the required lease capitalization criteria is(are)met.
• B)The lessee ignores a guaranteed salvage value when calculating depreciation expense associated with a capital lease.
• C)The lessor's annual income will decrease over time regardless of whether the lease is a sales-type lease or a direct financing lease.
• D)The manufacturer's or dealer's profit recorded by the lessor is the same whether or not the residual value is guaranteed by the lessee.

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