Multiple Choice
Celestion,Inc. ,leased equipment to Speaker Company on January 1,2014.The lease is for a five-year period ending January 1,2019.The first equal annual payment of $1,200,000 was made on January 1,2014.The cash selling price of the equipment is $5,174,552,which is equal to the present value of the lease payments at 8%.Celestion purchased the equipment for $4,300,000.
-Celestion should account for this lease as
A) an operating lease.
B) a direct-financing lease.
C) a sale-type lease.
D) leveraged lease.
Correct Answer:
Verified
Correct Answer:
Verified
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