(###20)No chat gpt answers & don't copy from chegg or else I'll give 5 downvotes...
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Accounting
###No chat gpt answers & don't copy from chegg or else I'll give downvotes
A company enters into a complex lease agreement. The terms include variable lease payments based on usage, a residual value guarantee by the lessee, and an implicit interest rate that is not readily determinable by the lessee. How should the lessee account for this lease?
A Recognize a rightofuse asset and lease liability based solely on the fixed lease payments.
B The lease should be treated as a capital lease, requiring the use of a discount rate based on lessee's incremental borrowing rate.
C The lease should be considered an operating lease as the implicit interest rate cannot be determined.
D The company should estimate a discount rate and utilize that rate to determine the rightofuse asset and lease liability.
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