If a Lessee Classifies a Lease as a Capital Lease

question 53

Multiple Choice

If a lessee classifies a lease as a capital lease and uses the straight-line method of depreciation, the amount to be amortized over the lease term is

• A) the original amount capitalized less the present value of the guaranteed residual value (if applicable)
• B) the original amount capitalized less the unguaranteed residual value
• C) the original amount capitalized less the guaranteed residual value (if applicable)
• D) fair value of the leased property

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Definitions:

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