How is an unguaranteed residual value accounted for by the lessee when computing minimum lease payments?
A) The present value of the guaranteed residual value is added in to determine the minimum lease payments.
B) It is ignored.
C) The future value of the guaranteed residual value is added in to determine the minimum lease payments.
D) The excess of guaranteed residual value over estimated residual value is added in by the lessee to determine the minimum lease payments.

Question

Quizplus · Accepted Answer

An unguaranteed residual value is ignored by the lessee when computing minimum lease payments, as it does not affect the lessee's obligation.

How Is an Unguaranteed Residual Value Accounted for by the Lessee