Business English Lesson, Advanced Level
ESL/EFL Test #249 [color=blue]“Business Buzzwords for Better or Worse”, question 6
The real estate assets subject to a … lease do not appear on the lessee’s balance sheet and no depreciation is charged against earnings for SEC reporting purposes, but its structure allows improvements to be depreciated for tax purposes, thus preserving the tax shelter aspect of owning improved real estate.
(a) simulated
(b) synthetic
(c) veritable
(d) virtual
Business English Lesson, Advanced Level
ESL/EFL Test #249 [color=blue]“Business Buzzwords for Better or Worse”, answer 6
The real estate assets subject to a synthetic lease do not appear on the lessee’s balance sheet and no depreciation is charged against earnings for SEC reporting purposes, but its structure allows improvements to be depreciated for tax purposes, thus preserving the tax shelter aspect of owning improved real estate.
Correct answer: (b) synthetic
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Hi,
How to understand the “synthetic lease” here? And how to understand this whole paragraph better? Thanks a lot!!