Which of the Following Is Not One of the Conditions

question 63

Multiple Choice

Which of the following is not one of the conditions for a capital lease?

• A)The lease term exceeds 90% of the estimated economic life of the property.
• B)The lease term equals or exceeds 75% of the estimated economic life of the property.
• C)Title is transferred to the lessee by the end of the lease.
• D)The present value of the lease payments is at least 90% of the leased asset's fair value at the start of the lease term.
• E)The lease contains a bargain purchase option.

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Definitions:

GDP

Gross Domestic Product is a calculation that reflects the economic success of a nation by summing the value of all produced goods and services within a certain time frame.

Consumption

The use of goods and services by households, contributing to the overall demand in an economy.

Investment

The act of allocating resources, usually money, with the expectation of generating an income or profit, often through the acquisition of assets.

Government Spending

Expenditures made by the government for its operations, provision of public services, or to stimulate the economy.