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Zuzu Inc . plans to acquire a capital asset worth US$50 00 0 . The asset is depreciable over 5 years on a straight- line

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Zuzu Inc . plans to acquire a capital asset worth US$50 00 0 . The asset is depreciable over 5 years on a straight- line basis , after which it will have no salvage value . Zuzu arranges for the asset to be leased for a lease rental of US$ 25 , 000 per year for two years after which it buys it for USSO 50 . Can Zuzu Inc . deduct the lease payments for income tax purposes ? Why ? Why not

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