Seaboard Inn has leased four limousines for use of its guests who want to attend the Newport Jazz Festival. This approach to the acquisition of limousines:
A) offers the inn no significant tax advantages.
B) allows the inn to retain its investment capital for other purposes.
C) requires the inn to pay all repair expenses.
D) increases the inn's capital outlay.
E) is impractical if the inn is a seasonal business.

Question

Quizplus · Accepted Answer

Leasing limousines allows Seaboard Inn to use its capital for other investments or needs instead of spending a large amount upfront to purchase vehicles. This approach conserves cash flow and investment capital.

Seaboard Inn Has Leased Four Limousines for Use of Its