Which of the Following Statements About Capital Leases Is INCORRECT

question 84

Multiple Choice

Which of the following statements about capital leases is INCORRECT?

• A)Under a capital lease, the lessee does not report the leased asset on the financial statements.
• B)A capital lease can transfer title of the leased asset to the lessee at the end of the lease term.
• C)A capital lease may contain a bargain purchase option.
• D)Under a capital lease, the lessee records a lease liability at the beginning of the lease term.

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Definitions:

Equity Comparisons

The process of comparing one's own ratio of contributions and rewards with the ratios of others to gauge fairness.

Goal-setting Theory

A motivation theory which posits that setting specific and challenging goals, along with appropriate feedback, enhances performance.

Task Goals

Specific objectives or targets set for tasks or activities, focusing on the completion and achievement of individual assignments.

Properly Set

Correctly established or arranged according to specified guidelines or principles.