You are discussing the classification of leases with Howie, a fellow associate at B and P LLP. Which one of Howie's statements regarding leases for a company reporting under ASPE is correct?: O a. If a lease has no bargain purchase option, it must be classified as an operating lease. O b. From a lessee's perspective, when determining the present value of the minimum lease payments, you only include annual lease payments. O C. When calculating the interest rate implicit in the lease, you include the minimum lease payments plus the unguaranteed residual value of the leased property. d. A lease is a capital lease if the present value of the minimum lease payments is 75% or more of the fair market value of the property at the inception of the lease.

You are discussing the classification of leases with Howie, a fellow associate at B and P LLP. Which one of Howie's statements regarding leases for a company reporting under ASPE is correct? a. If a lease has no bargain purchase option, it must be classified as an operating lease. b. From a lessee's perspective, when determining the present value of the minimum lease payments, you only include annual lease payments. c. When calculating the interest rate implicit in the lease, you include the minimum lease payments plus the unguaranteed residual value of the leased property. d. A lease is a capital lease if the present value of the minimum lease payments is 75% or more of the fair market value of the property at the inception of the lease