15 Feb Management has asked the accounting department to ensure that the new lease be structured as an operating lease, even changing the contract if necessary to keep the cost of the lea
Management has asked the accounting department to ensure that the new lease be structured as an operating lease, even changing the contract if necessary to keep the cost of the lease in rent expense instead of adding to interest expense and depreciation. Saola’s controller feels that the company should get the most appropriate contract for their needs, then worry about the accounting classification. Provide two (2) arguments that the controller could use to convince the management team that her plan is the most appropriate.
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