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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