The Primary Difference Between a Direct-Financing Lease and a Sales-Type

question 24

Multiple Choice

The primary difference between a direct-financing lease and a sales-type lease under SFAS No.13 is the

• A)Recognition of the manufacturer's or dealer's profit at or loss)the inception of the lease
• B)Amount of the depreciation recorded each year by the lessor
• C)Allocation of initial direct costs by the lessor to periods benefited by the lease arrangements
• D)Manner in which rental receipts are recorded as rental income

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Definitions:

Lyndon B. Johnson

The 36th President of the United States, known for his Great Society social service programs and significant role in the Vietnam War.

Tax Cut

A reduction in the amount of taxes imposed by the government on individuals or businesses, often aimed at stimulating economic growth.

Political Business Cycles

Economic fluctuations that occur when discretionary policy is manipulated for political gain.

Discretionary Policy

This involves government policies, like fiscal and monetary policy decisions, that are deliberately formulated and applied in response to economic conditions to manage aggregate demand.