Which of these contractual terms would lead a company to account for a lease contract...

50.1K

Verified Solution

Question

Accounting

Which of these contractual terms would lead a company to account for a lease contract under the capital lease method? (check all that apply)

The present value of the lease payments is $89,000. The truck could be bought today for $100,000 cash.

The lessee can buy the truck at its current market value at the end of the lease

The lease runs for 2 years on a truck that is expected to have a 6 year life

Ownership stays with the lessor at the end of the lease

The IRS requires capital lease method for tax purposes for this contract

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students