Compared to using a ﬁnance lease, a lessee that makes use of an operating lease will most likely report higher:
A) Bank debt
B) Rent or lease expense
C) Current ratio
D) Cash ﬂows from ﬁnancing activities

Question

Quizplus · Accepted Answer

Operating leases are expensed as rent or lease expense on the income statement, leading to higher reported expenses compared to finance leases.

Compared to Using a ﬁNance Lease, a Lessee That Makes