Asked by Erika Driesen on May 09, 2024
Verified
A lease where the intent is temporary use of the property by the lessee with continued ownership of the property by the lessor is called
A) off-balance sheet financing.
B) an operating lease.
C) a capital lease.
D) a purchase of property.
Operating Lease
A contract that allows for the use of an asset but does not convey rights of ownership of the asset.
Capital Lease
A lease agreement in which the lessee essentially has the economic benefits and risks of ownership, often leading to the asset being recorded on the lessee's balance sheet.
Temporary Use
The use of an asset or resource for a limited period of time, not intended for long-term or permanent use.
- Acquire knowledge about the handling and consequence of leases in financial accounting.
Verified Answer
Learning Objectives
- Acquire knowledge about the handling and consequence of leases in financial accounting.
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