If a capital lease contains a bargain purchase option, the depreciation period that is used by the lessee for the asset is ________.
A) the useful life to the lessee
B) the same period used by the lessor
C) the lease term
D) the statutory life for all assets in that class

Question

Quizplus · Accepted Answer

If a capital lease contains a bargain purchase option, the lessee should depreciate the leased asset over its useful life to the lessee, as the lessee is expected to exercise the option and own the asset.

If a Capital Lease Contains a Bargain Purchase Option, the Depreciation