An option to purchase the leased asset for an amount sufficiently below the expected fair value at the end of the lease term is known as a/an:
A)minimum lease option
B)guaranteed residual option
C)bargain purchase option
D)lease term option

Question

Quizplus · Accepted Answer

A bargain purchase option allows the lessee to purchase the leased asset at a price significantly lower than its expected fair value at the end of the lease term. This option is favorable for the lessee as it provides them with the opportunity to own the asset at a bargain price.

An Option to Purchase the Leased Asset for an Amount