Which of the Following Lease Criteria Would Not Qualify a Lease

question 3

Multiple Choice

Which of the following lease criteria would not qualify a lease as a capital lease?

• A) The lease transfers ownership of the property to the lessee by the end of the lease term.
• B) The lease contains an option to purchase the leased property at its fair market value.
• C) The lease term is equal to or greater than 75% of the estimated economic life of the leased property.
• D) The present value of the minimum lease payments equals or exceeds 90% of the fair value of the leased property.

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Definitions:

Association

The process of connecting ideas, feelings, or experiences in the mind, or the relationship between objects, events, or data that often implies a link or correlation.

Correlational Research

A type of research methodology that aims to determine the degree to which two or more variables are related without manipulation by the researcher.

Cause-Effect

A relationship where one event (the cause) makes another event happen (the effect), indicating a connection between actions or occurrences.

Experimentation

The act of conducting a controlled test or investigation to explore a hypothesis or examine the effects of variables.