Chartered Financial Analyst Level 1

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Which of the following statements best describes the effect of finance leases on financial statements?

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Last updated: December 6, 2025 at 10:02

A

Balance sheet effects differ based on whether the lease is a direct financing lease or a sales-type lease

33.3%

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B

The lessor reports a profit on the sale of the leased asset on the income statement in the case of a sales-type lease

33.3%

C

A lessee reports the interest portion of the lease payment as operating cash flow under IFRS and financing cash flow under US GAAP

33.3%

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