Contingent rent is one of three common methods used to avoid capitalization.

Name: Contingent rent is one of three common methods used to avoid capitalization.
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Contingent rent refers to lease payments that change based on the occurrence of a future event or the performance of the underlying asset, not a method to avoid capitalization. Methods to avoid capitalization typically involve structuring leases to meet specific criteria to be classified as operating leases rather than capital leases.

Contingent Rent Is One of Three Common Methods Used to Avoid