Which of the following lease conditions would result in a capital lease to the lessee?

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Which of the following lease conditions would result in a capital lease to the lessee?

A) The lessee will return the proper of the lessor at the end of the lease term
B) The lessee obtains enough rights to use the asset and is in substance the owner
C) The leased asset is not capitalized on the balance sheet
D) The lease term is 70% of the property’s economic life

Answer: B

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