BUSINESS ADMINISTRATION
FINANCIAL MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Which among the following is not true about an operating lease1. Short term lease2. Irrevocable3. Lessee bears the cost of maintenance and insurance 4. Revocable
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2 & 3
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2 & 4
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Only 4
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1 & 4
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Explanation:
Detailed explanation-1: -Definition: An operating lease is a short-term lease or contract in which the lessee agrees to rent an asset from the lessor and the lessor retains the rights of ownership. In other words, an operating lease is a lease that is less than one year in length and the lessor always maintains ownership of the leased asset.
Detailed explanation-2: -An operating lease is a contract that permits the use of an asset without transferring the ownership rights of said asset. A finance lease is a contract that permits the use of an asset and transfers ownership after the lease period is complete, and the lessor meets all other contract obligations.
There is 1 question to complete.