When both the gross investment and cost of the leased asset is equal for both direct and sales-type finance lease with the sales-type finance lease resulting to a gross profit, which of the two would have a lower implicit interest rate on the lease? Sales-Type Lease Direct Finance Lease Cannot be determined Equal for both
When both the gross investment and cost of the leased asset is equal for both direct and sales-type finance lease with the sales-type finance lease resulting to a gross profit, which of the two would have a lower implicit interest rate on the lease? Sales-Type Lease Direct Finance Lease Cannot be determined Equal for both
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter20: Accounting For Leases
Section: Chapter Questions
Problem 8GI
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Question
When both the gross investment and cost of the leased asset is equal for both direct and sales-type finance lease with the sales-type finance lease resulting to a gross profit, which of the two would have a lower implicit interest rate on the lease?
Sales-Type Lease
Direct Finance Lease
Cannot be determined
Equal for both
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