When a Government Acquires General Fixed Assets Under a Capital

Multiple Choice

When a government acquires general fixed assets under a capital lease agreement, the asset should be recorded in the General Fund's fund basis financial statements:

A) As a capital asset and lease obligation at the inception of the lease agreement at the lesser of the present value of the minimum lease payments or the fair market value of the property
B) as debt service expenditures when payments are made
C) As a capital asset and lease obligation at the inception of the lease agreement for the total lease payments
D) as an expense when payments are made