Eldon Leases Tools and Other Equipment on a Long- Term

Multiple Choice

Eldon leases tools and other equipment on a long- term basis to construction companies. He needs to buy a new forklift truck to lease in his business. Which of the following describes ways that Eldon could acquire the forklift truck?

A) Eldon could buy the forklift truck for cash from the manufacturer.
B) Eldon could lease the forklift truck from the manufacturer with an option to purchase it for fair market value at the end of the lease.
C) Eldon could borrow money from a bank, use the money to buy the forklift truck from the manufacturer, and give the bank a security interest in the forklift truck.
D) Eldon could buy the forklift truck on credit from the manufacturer, with the manufacturer retaining title until payment has been made in full.
E) All of the above.