Under SFAS No. 13, leases that do not meet one of four criteria for a capital lease are treated as operating leases. Operating leases do not appear on the balance sheet.

Select one of the two Teams and properly defend your position!

Team 1: Argue for the capitalization of leases that do not meet any of the SFAS No. 13 criteria for a capital lease.

Team 2: Argue against the capitalization of leases that do not meet any of the SFAS No. 13 criteria for a capital lease.

Background for consideration:

Philippians 4:13 (NIV) "I can do all things through Christ who strengthens me." In making ethical business decisions, you may find your decisions challenged. Remember to have the confidence to stand firm and not compromise your ethics.

1 Corinthians 5:10 (NIV) "nor thieves nor the greedy nor drunkards nor slanderers not swindlers will inherit the kingdom of God." Greed is a temptation that can challenge business finance ethics.