Advantages of Leasing from the Lessee's Perspective Include All of the Following

question 127

Multiple Choice

Advantages of leasing from the lessee's perspective include all of the following EXCEPT

• A) capability of effectively depreciating land.
• B) ability to avoid restrictive covenants that are normally part of a long-term loan.
• C) benefit of the salvage value at the end of the term of the lease reverts to the lessor.
• D) 100 percent financing.

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Definitions:

Income-Sharing Ratio

An agreed upon proportion used to distribute profits or losses among partners in a partnership.

Limited Liability Company

A corporate model that integrates the flow-through taxation characteristic of partnerships and sole proprietorships with the protective limited liability found in corporations.

Business Entity

A legal organization created by individuals, stockholders, or shareholders, with the purpose of operating for profit.

Partnership Form

A type of business organization in which two or more individuals manage and operate the business in accordance with the terms and objectives set out in the Partnership Deed.