A Noncancelable Lease Contains a Bargain Purchase Option

question 5

Multiple Choice

A noncancelable lease contains a bargain purchase option.The fair value of the asset exceeds the lessor's cost of the asset.Collectibility of the lease payments is assured and there are no material cost uncertainties surrounding the lease.Therefore,the lease will be accounted for by the lessor as a(n) :

• A)Sales-type lease.
• B)Direct financing lease.
• C)Operating lease.
• D)Guaranteed lease.

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Definitions:

Preconventional Stage

A developmental phase in Kohlberg's theory of moral development where moral reasoning is based primarily on the consequences of actions and on rewards and punishments.

Formal Operational Stage

The final stage of Piaget's theory of cognitive development, where individuals develop the ability to think abstractly, logically, and systematically.

Self-Concept

an individual's understanding of themselves, including their beliefs, feelings, and thoughts about their own identity, abilities, and worth.

Self-Esteem

A person's overall subjective sense of personal worth or value, how much a person appreciates, likes, or approves of themselves.