Which One of the Following Is Not Considered a Criteria

question 62

Multiple Choice

Which one of the following is not considered a criteria to capitalize a lease?

• A) The lease contains a bargain purchase option.
• B) The lease transfers ownership at the end of the lease term.
• C) The lease term is more than 75% of economic life of the property.
• D) The present value of minimum lease payments is less than 90% of the fair market value of the asset.

Comprehend the periodicity and independence requirement of internal reviews for reinforcing internal controls.

Acknowledge the limitations and the cost-benefit principle underlying internal controls.

Distinguish between the roles and responsibilities within an internal control system to prevent and detect fraud.

Identify the role and importance of segregation of duties in internal control systems.

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Definitions:

Finished Goods

Products that have completed the manufacturing process and are ready to be sold to customers.

Customers

Individuals or entities that purchase goods or services from another entity, often seen as the final recipient in a supply chain.