Which of the Following Is a Benefit of Leasing

question 25

Multiple Choice

Which of the following is a benefit of leasing?

• A) It is usually much easier to replace owned assets than it is to replace leased assets.
• B) The cost of leasing an asset is less than the cost of purchasing it.
• C) There are no restrictions on the use,maintenance,and disposal of leased assets.
• D) An asset can be leased at a very low down payment.

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Definitions:

Straight-Line Depreciation

A method of allocating the cost of an asset evenly over its useful life, used for calculating depreciation expenses on the income statement.

Capital Budgeting

The process of planning and evaluating investments in long-term assets to determine which projects will generate the most profitable returns.

Straight-Line Depreciation

A method of allocating the cost of a tangible asset over its useful life in equal annual amounts, making the expense predictable and consistent.

Income Taxes

Taxes levied by governments on individuals' or businesses' net income, where the amount owed varies based on the level of the income earned.