Which of the Following Meets the Criteria for a Capitalized

question 83

Multiple Choice

Which of the following meets the criteria for a capitalized lease under GAAP in the U.S.?

• A)The present value of the future minimum payments is $90,000 and the fair value is $110,000.
• B)The lessee can purchase the asset for an amount that is greater than fair vale at the end of the lease.
• C)The lease term is ten years and the useful life of the asset is 11 years.
• D)Title does not transfer by the end of the lease term.

---

Definitions:

Chesapeake Area

A region encompassing parts of Virginia and Maryland known for its significant historical, cultural, and economic development during the colonial and early United States periods.

American Exports

entails goods and services produced in the United States that are sold and shipped to other countries.

Tobacco

A plant that contains nicotine and is grown for its leaves, which are dried and processed for smoking, chewing, or as snuff.

West Indies

A region in the Caribbean basin that encompasses a group of islands known for their diverse cultures, colonial history, and significant role in the global economy, especially during the era of the Atlantic slave trade.