he lessor will recognized the same gross profit whether the residual value is guaranteed by the lessee or not guaranteed by the lessee. Statement 2: Any initial direct cost paid by the lessor shall reduce the amount of unearned interest income that the lessor shall recognized at inception of the lease. Group of answer choices
he lessor will recognized the same gross profit whether the residual value is guaranteed by the lessee or not guaranteed by the lessee. Statement 2: Any initial direct cost paid by the lessor shall reduce the amount of unearned interest income that the lessor shall recognized at inception of the lease. Group of answer choices
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Statement 1: The lessor will recognized the same gross profit whether the residual value is guaranteed by the lessee or not guaranteed by the lessee.
Statement 2: Any initial direct cost paid by the lessor shall reduce the amount of unearned interest income that the lessor shall recognized at inception of the lease.
Statement 2: Any initial direct cost paid by the lessor shall reduce the amount of unearned interest income that the lessor shall recognized at inception of the lease.
Group of answer choices
Both statements are incorrect.
Only statement 1 is correct
Only statement 2 is correct
Both statements are correct
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