For the lessee to account for a lease as a finance lease, the lease must meet: Multiple Choice Any two of the criteria specified by GAAP regarding accounting for leases. All five of the criteria specified by GAAP regarding accounting for leases. Any one of the six criteria specified by GAAP regarding accounting for leases. Any one of the five criteria specified by GAAP regarding accounting for leases.

Question

Sariah Foster

Business

14 August, 19:37

For the lessee to account for a lease as a finance lease, the lease must meet: Multiple Choice Any two of the criteria specified by GAAP regarding accounting for leases. All five of the criteria specified by GAAP regarding accounting for leases. Any one of the six criteria specified by GAAP regarding accounting for leases. Any one of the five criteria specified by GAAP regarding accounting for leases.

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Answers (1)

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Kolten Caldwell · Answer 1

The correct answer is Any one of the five criteria specified by GAAP regarding accounting for leases.

Explanation:

According to the information in FAS 13, criteria for accounting for financial and operating leases must be followed, such that the asset must be recognized all the risks according to the property, considering the times of the lease and in other cases the future purchase options the which must be reasonably recorded. If these criteria are not met it should be classified as an operating lease.