A Lease Contains a Bargain Purchase Option

question 31

Multiple Choice

A lease contains a bargain purchase option.In determining the lessee's capitalizable cost at the beginning of the lease term,the payment called for by the bargain purchase option would be

• A) subtracted at its present value.
• B) added at its exercise value.
• C) added at its present value.
• D) subtracted at its exercise price.

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Definitions:

Profit

The financial gain achieved when the revenues generated from business activities exceed the expenses, costs, and taxes involved in maintaining the activity.

Consistently

Consistently refers to acting or performing in the same manner over time, ensuring uniformity and reliability in behavior or outcomes.

Significant Achievement

A considerable or noteworthy accomplishment that marks progress toward a goal.

Purpose

The reason for which something is done or created or for which something exists.