In a Lease Agreement

question 184

Multiple Choice

In a lease agreement:

• A) the owner of the property is called the lessee.
• B) the renter of the property is called the lessor.
• C) the presence of a bargain purchase option indicates that it is a capital lease.
• D) there is always a transfer of ownership of the leased asset at the end of the lease.

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Definitions:

Inventory System

A method or software used by organizations to track inventory levels, orders, sales, and deliveries.

Physical Inventory

A process where a business counts its entire inventory by hand at a specific point in time to verify stock quantities.

Cost Flow Assumption

An accounting method used to value inventory and determine the cost of goods sold, such as FIFO (First-In, First-Out) or LIFO (Last-In, First-Out).

Specific Identification

Specific identification is an inventory valuation method that tracks the cost of individual items in inventory and matches those costs with the items' actual sale.