An operating lease is not cancelable and obligates the lessee to make payments for the use of an asset over a predefined period of time.

Question

Quizplus · Accepted Answer

An operating lease is cancelable and provides flexibility for the lessee to end the lease early if needed. The lessee is only obligated to make payments during the lease term, but has the option to return the asset to the lessor at the end of the lease.

An Operating Lease Is Not Cancelable and Obligates the Lessee