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The FASB agrees with which of the following viewpoints regarding capitalization of leases?

a. capitalize firm leases where the penalty for nonperformance is substantial
b. do not capitalize any leased assets
c. capitalize all long term leases
d. capitalize those leases similar to installment purchases

User PChemGuy
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Final answer:

The FASB agrees with viewpoint d, which is to capitalize leases similar to installment purchases.

Step-by-step explanation:

The FASB (Financial Accounting Standards Board) agrees with viewpoint d, which is to capitalize those leases similar to installment purchases.

When determining whether a lease should be capitalized, the FASB considers whether the lease is similar to an installment purchase. If a lease transfers substantially all the risks and rewards of ownership to the lessee, it is classified as a capital lease and must be capitalized on the lessee's balance sheet.

For example, if a lease agreement includes a bargain purchase option at the end of the lease term or if the lease term is for a major part of the asset's economic life, the lease is likely to be classified as a capital lease and therefore capitalized.

User Jordan Ryder
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