A capital lease begins on 1/1/16.

A capital lease begins on 1/1/16. Failure to record the 1/1/16 lessor entries for a direct financing, ordinary annuity lease would have what effect on the 1/1/16 lessor Total Assets and Total Equity, respectively?

Select one:

a. No Error, No Error

b. No Error, Understated

c. No Error, Overstated

d. Understated, No Error