[amp_mcq option1=”i and iv” option2=”i, iii and iv” option3=”ii, iii and iv” option4=”Only ii” correct=”option1″]<\/p>\n
The correct answer is: A. i and iv<\/p>\n
Statement i is true because tax-shield on depreciation and interest is an important variable both for the lessor and the lessee. The lessor can claim depreciation on the leased asset, which reduces its taxable income. The lessee can claim interest expense on the lease, which reduces its taxable income.<\/p>\n
Statement ii is false because lease transactions in India are governed by the Indian Contract Act, 1872.<\/p>\n
Statement iii is true because a lessee should evaluate the lease options against the buying option to determine which option is more beneficial.<\/p>\n
Statement iv is true because as per AS-19, financial lease is shown in the balance sheet of the lessee as an asset.<\/p>\n
Here is a brief explanation of each option:<\/p>\n
[amp_mcq option1=”i and iv” option2=”i, iii and iv” option3=”ii, iii and iv” option4=”Only ii” correct=”option1″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[85],"tags":[],"class_list":["post-45835","post","type-post","status-publish","format-standard","hentry","category-accounting","no-featured-image-padding"],"yoast_head":"\n