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direct-financing lease

direct-financing lease

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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D3)
Dallas Mfg produces combines at an inventory cost of $35,000 each that sell for $42,000 each. For credit-approved customers, Dallas leases the combines for $8,000 per year for five years. The combines are guaranteed to last four years and generally have a six-year life. Collection is predictable and reasonably assured. Additionally, the lessee is aware of all costs to be incurred under the lease that will| not be reimbursed by the lessor. Dallas Mfg treats a lathe lease as a(an) operating lease ordinary capital lease sales-type lease direct-financing lease
Transcribed Image Text:Dallas Mfg produces combines at an inventory cost of $35,000 each that sell for $42,000 each. For credit-approved customers, Dallas leases the combines for $8,000 per year for five years. The combines are guaranteed to last four years and generally have a six-year life. Collection is predictable and reasonably assured. Additionally, the lessee is aware of all costs to be incurred under the lease that will| not be reimbursed by the lessor. Dallas Mfg treats a lathe lease as a(an) operating lease ordinary capital lease sales-type lease direct-financing lease
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