CLFP Exam - History & Overview
Exam Questions and Answers 100%
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What year does leasing law date back to? - CORRECT ANSWER-2010 B.C. in
the Sumerian City of Ur - used clay tablets
Where does leasing law date back to (who)? - CORRECT ANSWER-The code of
Hammurabi is the first record of leasing law "an eye for an eye". He acknowledged
leasing of personal property in his code of laws.
What are some early examples of a true lease? - CORRECT ANSWER-Shipping
charters - Phoenicians
What was used in England to deal directly with the leasing of personal property? -
CORRECT ANSWER-Statute of Wales
What brought the first real growth of leasing to the US? - CORRECT ANSWER-
The railroad industry during the Industrial Revolution
Describe the Philadelphia Plan - CORRECT ANSWER-Most well-known finance
plan: sough financing for the trains and rail cars (they could only afford to build
the track).
, What led to modern day leasing? (1950s, post WW11) - CORRECT ANSWER-
Governmental efforts to stimulate the economy and the Introduction of
Accelerated Depreciation
What does IRS Revenue Ruling 55-540 do? - CORRECT ANSWER-Defines a
true lease for tax purposes - defines what is NOT a true lease for tax purposes, if
any were true it would be a CSC. Distinguished between a true lease and a
conditional sales contract.
Name the IRS Revenue Ruling 55-540 acronym - CORRECT ANSWER-PAINEE
P- Rental PAYMENTS are not higher than a fair rental value
A- Ownership of the asset does not AUTOMATICALLY pass to the lessee at the
end of the term
I- No portion of the lease payment is characterized as INTEREST
N- The transaction does not include a NOMINAL purchase option
E- No portion of the lease payments can be applied to an EQUITY position in the
asset
E- The amount paid under a short-term lease is not a significant portion of the
price (EXCESSIVE lease payments)
COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED
Exam Questions and Answers 100%
Pass
What year does leasing law date back to? - CORRECT ANSWER-2010 B.C. in
the Sumerian City of Ur - used clay tablets
Where does leasing law date back to (who)? - CORRECT ANSWER-The code of
Hammurabi is the first record of leasing law "an eye for an eye". He acknowledged
leasing of personal property in his code of laws.
What are some early examples of a true lease? - CORRECT ANSWER-Shipping
charters - Phoenicians
What was used in England to deal directly with the leasing of personal property? -
CORRECT ANSWER-Statute of Wales
What brought the first real growth of leasing to the US? - CORRECT ANSWER-
The railroad industry during the Industrial Revolution
Describe the Philadelphia Plan - CORRECT ANSWER-Most well-known finance
plan: sough financing for the trains and rail cars (they could only afford to build
the track).
, What led to modern day leasing? (1950s, post WW11) - CORRECT ANSWER-
Governmental efforts to stimulate the economy and the Introduction of
Accelerated Depreciation
What does IRS Revenue Ruling 55-540 do? - CORRECT ANSWER-Defines a
true lease for tax purposes - defines what is NOT a true lease for tax purposes, if
any were true it would be a CSC. Distinguished between a true lease and a
conditional sales contract.
Name the IRS Revenue Ruling 55-540 acronym - CORRECT ANSWER-PAINEE
P- Rental PAYMENTS are not higher than a fair rental value
A- Ownership of the asset does not AUTOMATICALLY pass to the lessee at the
end of the term
I- No portion of the lease payment is characterized as INTEREST
N- The transaction does not include a NOMINAL purchase option
E- No portion of the lease payments can be applied to an EQUITY position in the
asset
E- The amount paid under a short-term lease is not a significant portion of the
price (EXCESSIVE lease payments)
COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED
