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Capital Budgeting Profits Through Leasing


Capital Budgeting Profits Through Leasing
 

a. Flexible

This means that the structure of the contract can be tailored to the needs of the company.

b. Does not require collateral

That is the legitimate right of ownership over the assets in lease and lease payment arrangements.

c. Capital saving

This means that the company did not provide substantial funds, only the down payment amount is not too large.

d. Fast in service

This means that leasing procedure is simpler and relatively faster in comparison to credit financing investment bank.

e. Repayment of lease is required as operating costs.

That is a direct lease payments as an expense in the determination count company's income.

f. Shielded from inflation

This means that lease can avoid the risk of a decrease in the value of money caused by inflation.

g. The existence of an option for leassee at the end of the lease

h. Their legal certainty

This means that a leasing agreement can not be undone in a state of public finances.

i. Sometimes leasing is the only way to acquire the assets of a company.

 

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