All of the Following Statements Regarding Leases Are True Except

question 94

Multiple Choice

All of the following statements regarding leases are true except:

• A)For a capital lease the lessee records the leased item as its own asset.
• B)For a capital lease the lessee depreciates the asset acquired under the lease,but for an operating lease the lessee does not.
• C)Capital leases create a long-term liability on the balance sheet,but operating leases do not.
• D)Capital leases do not transfer ownership of the asset under the lease,but operating leases often do.
• E)For an operating lease the lessee reports the lease payments as rental expense.

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Definitions:

Reciprocal Relationship

A mutual relationship where two or more entities influence or are interconnected with each other.

Functional Areas

Specific segments of a business organized around particular activities or tasks, such as marketing, finance, or human resources.

HR Strategy

A detailed plan by the human resources department focusing on long-term workforce management and development to align with the organization's goals.

Internal Fit

The degree to which an organization's internal strategies, systems, and processes are aligned and consistent with each other.