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  3. which of the following is false? a. the lessee use

Which of the following is false? A. The lessee uses the lower of its incremental...

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Accounting

Which of the following is false?

A. The lessee uses the lower of its incremental borrowing rate or the lessors desired return rate (if known) when determining the present value of minimum lease payments.

B. A lease is capitalized if the present value of the minimum lease payments is greater than or equal to 75% of the estimated fair market value of the leased asset.

C. An operating lease is an example of off-balance-sheet financing.

D. Including a guaranteed residual value makes it more likely that a lessee will capitalize a lease.

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