Operating leases differ from capital leases in that For a capital lease the less

Question

Operating leases differ from capital leases in that        For a capital lease the lessee records the lease payments as rent expense, but for an operating lease the lessee reports the lease payments as depreciation expense
       For an operating lease the lessee depreciates the asset acquired under lease, but for the capital lease the lessee does not
       Operating leases create a long-term liability on the balance sheet, but capital leases do not
       Operating leases do not transfer ownership of the asset under the lease, but capital leases often do
       Operating lease payments are generally greater than capital lease payments Operating leases differ from capital leases in that

Explanation / Answer

For a capital lease the lessee records the lease payments as rent expense, but for an operating lease the lessee reports the lease payments as depreciation expens

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