1.

All of the following are differences that occur if a lease is classified as a capital lease instead of an operating lease except

a decrease in the amount of total expenses.

an increase in the amount of reported debt.

an increase in the amount of total assets.

a lower income early in the life of the lease.

2.Which of the following is not true with an operating lease?

Depreciation charges that are incurred during the period are not charged to expense

The lessor records each rental receipt as rental income

Other operating costs that are incurred during the period are charged to expense

Maintenance costs that are incurred during the period are charged to expense

3.

All of the following are advantages of leasing except

100% financing at fixed rates.

elimination of the risk of obsolescence.

less costly financing.

off-balance sheet financing.

4.

Under IFRS 16, lease payments include all of the following except

amount expected to be payable by the lessee under residual value guarantees.

a purchase option.

executory costs.

the minimum rental payments.