A lease agreement will qualify as a finance lease if one of these conditions occur: A. The lessee returns the leased property to the lessor at the end of the lease term. B. The lease does not have a bargain purchase option. C. The lease term is for major of the economic life of the asset. D. The present value of the minimum lease payment amounts to substantially less than the fair value of the leased asset.
A lease agreement will qualify as a finance lease if one of these conditions occur: A. The lessee returns the leased property to the lessor at the end of the lease term. B. The lease does not have a bargain purchase option. C. The lease term is for major of the economic life of the asset. D. The present value of the minimum lease payment amounts to substantially less than the fair value of the leased asset.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter20: Accounting For Leases
Section: Chapter Questions
Problem 8RE: Use the following information to decide whether this equipment lease qualifies as an operating,...
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A lease agreement will qualify as a finance lease if one of these conditions
occur:
A. The lessee returns the leased property to the lessor at the end of the lease term.
B. The lease does not have a bargain purchase option.
C. The lease term is for major of the economic life of the asset.
D. The present value of the minimum lease payment amounts to substantially less than the fair value of the leased asset.
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