When a Finance Company Purchases Assets with Its Own Funds

question 81

Multiple Choice

When a finance company purchases assets with its own funds and leases them to a lessee for a negotiated long-term period this is called a/an:

• A) direct lease.
• B) sale and lease-back.
• C) operating lease.
• D) leveraged lease.

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Definitions:

Trade Discount

A reduction in the listed price of goods or services provided by the seller to those in the same trade or industry.

Retail List Price

The manufacturer's suggested retail price for a product, which is often higher than the actual selling price in stores.

Best-Selling Grass Seed

A type of grass seed that has achieved high sales volumes and popularity due to its quality, resilience, or suitability for various climates or soils.

Noncumulative Quantity Discount

A price reduction offered on a single purchase order, not based on the quantity ordered over time.