When Is It Appropriate for the Lessee to Use the Lessor's

Multiple Choice

When is it appropriate for the lessee to use the lessor's implicit rate to discount the minimum lease payments?

A) whenever the lessee knows what the lessor's rate is
B) when the lessor's rate is higher than the lessee's incremental borrowing rate
C) when the lessee's incremental borrowing rate is lower than the lessor's rate
D) when the lessor's implicit rate is lower than the lessee's incremental borrowing rate