CLFP Exam History & Leasing Law Questions
and Answers 2026 Guide
1. What authority defines what a lease is for accounting d. Financial Accounting
purposes? Standards Board (FASB)
Select one:
a. Financial Assets Standards Board
b. Financial Accounting Services Board
c. Flavored Apples Standards Board
d. Financial Accounting Standards Board
2. What authority defines what a lease is for legal purpos- a. UCC
es?
Select one:
a. UCC
b. IRS
c. Bankruptcy Code
d. Common law
3. What section of the IRS Code defines what is not a b. IRS 55-540
lease, for tax purposes?
Select one:
a. IRS 8401-77
b. IRS 55-540
c. IRS 2001-28
d. IRS 842-2A
4. What is a Capital Lease? b. A lease that has the
Select one: characteristics of a pur-
a. A lease that has the characteristics of a usage agree- chase agreement, as de-
ment, as defined by ASC 842. fined by ASC 842
b. A lease that has the characteristics of a purchase
agreement, as defined by ASC 842.
c. A lease that has the characteristics of a true lease, as
defined by UCC.
, CLFP Exam History & Leasing Law Questions
and Answers 2026 Guide
d. A lease that has the characteristics of a secured
transaction, as defined by UCC.
5. What is the significance of Revenue Procedure a. It lays out criteria the
2001-28? IRS would use to respond
Select one: to advanced rulings on
a. It lays out criteria the IRS would use to respond to whether a transaction is a
advanced rulings on whether a transaction is a lease. lease.
b. It lays out criteria the IRS would use to respond to
advanced rulings on whether a transaction is a loan.
c. It lays out criteria the FASB would use to respond to
advanced rulings on whether a transaction is a lease.
d. In the context of equipment financing, it has no
significance.
6. How long is the term of a Rental Agreement (AKA a. Less than 12 months
short-service lease)?
Select one:
a. Less than 12 months
b. Less than 1 month
c. Less than 3 months
d. Less than 6 months
7. What does "TRAC" stand for when referring to a TRAC a. Terminal Rental Adjust-
Lease? ment Clause
Select one:
a. Terminal Rental Adjustment Clause
b. Terminus Rent Amendment Clause
c. Terminal Rent Alteration Clause
d. Terminus Rental Amendment Change
8. Which of the following is not true about an equipment c. Lessor retains right, use,
lease? and possession
, CLFP Exam History & Leasing Law Questions
and Answers 2026 Guide
Select one:
a. Lessor transfers tangible property for consideration
b. Lessor transfers use and possession
c. Lessor retains right, use, and possession
d. Transfer of property is for a specified time
9. If an equipment lease company's typical transaction d. Mid-ticket
size is $2,500,000 - $3,500,000, which market does the
company operate in?
Select one:
a. Small-ticket
b. Micro-ticket
c. Big-ticket
d. Mid-ticket
10. Which term refers to short-term, unsecured loans that b. Working Capital Loan
are used as a complement to a lease?
Select one:
a. Merchant Cash Advance
b. Working Capital Loan
c. Invoice Factoring
d. Secured Loans
11. Name the financial product described below. All costs b. Net Lease
in connection with the use of the property are paid
separately by the lessee and are not included in the
rental payment to the lessor.
Select one:
a. Finance Lease
b. Net Lease
c. Leveraged Lease
d. Non-Tax Lease
and Answers 2026 Guide
1. What authority defines what a lease is for accounting d. Financial Accounting
purposes? Standards Board (FASB)
Select one:
a. Financial Assets Standards Board
b. Financial Accounting Services Board
c. Flavored Apples Standards Board
d. Financial Accounting Standards Board
2. What authority defines what a lease is for legal purpos- a. UCC
es?
Select one:
a. UCC
b. IRS
c. Bankruptcy Code
d. Common law
3. What section of the IRS Code defines what is not a b. IRS 55-540
lease, for tax purposes?
Select one:
a. IRS 8401-77
b. IRS 55-540
c. IRS 2001-28
d. IRS 842-2A
4. What is a Capital Lease? b. A lease that has the
Select one: characteristics of a pur-
a. A lease that has the characteristics of a usage agree- chase agreement, as de-
ment, as defined by ASC 842. fined by ASC 842
b. A lease that has the characteristics of a purchase
agreement, as defined by ASC 842.
c. A lease that has the characteristics of a true lease, as
defined by UCC.
, CLFP Exam History & Leasing Law Questions
and Answers 2026 Guide
d. A lease that has the characteristics of a secured
transaction, as defined by UCC.
5. What is the significance of Revenue Procedure a. It lays out criteria the
2001-28? IRS would use to respond
Select one: to advanced rulings on
a. It lays out criteria the IRS would use to respond to whether a transaction is a
advanced rulings on whether a transaction is a lease. lease.
b. It lays out criteria the IRS would use to respond to
advanced rulings on whether a transaction is a loan.
c. It lays out criteria the FASB would use to respond to
advanced rulings on whether a transaction is a lease.
d. In the context of equipment financing, it has no
significance.
6. How long is the term of a Rental Agreement (AKA a. Less than 12 months
short-service lease)?
Select one:
a. Less than 12 months
b. Less than 1 month
c. Less than 3 months
d. Less than 6 months
7. What does "TRAC" stand for when referring to a TRAC a. Terminal Rental Adjust-
Lease? ment Clause
Select one:
a. Terminal Rental Adjustment Clause
b. Terminus Rent Amendment Clause
c. Terminal Rent Alteration Clause
d. Terminus Rental Amendment Change
8. Which of the following is not true about an equipment c. Lessor retains right, use,
lease? and possession
, CLFP Exam History & Leasing Law Questions
and Answers 2026 Guide
Select one:
a. Lessor transfers tangible property for consideration
b. Lessor transfers use and possession
c. Lessor retains right, use, and possession
d. Transfer of property is for a specified time
9. If an equipment lease company's typical transaction d. Mid-ticket
size is $2,500,000 - $3,500,000, which market does the
company operate in?
Select one:
a. Small-ticket
b. Micro-ticket
c. Big-ticket
d. Mid-ticket
10. Which term refers to short-term, unsecured loans that b. Working Capital Loan
are used as a complement to a lease?
Select one:
a. Merchant Cash Advance
b. Working Capital Loan
c. Invoice Factoring
d. Secured Loans
11. Name the financial product described below. All costs b. Net Lease
in connection with the use of the property are paid
separately by the lessee and are not included in the
rental payment to the lessor.
Select one:
a. Finance Lease
b. Net Lease
c. Leveraged Lease
d. Non-Tax Lease
