Why is it appropriate to compare the cost of lease financing with that of debtfinancing?

Q: Describe how a "bargain buy option" affects the lessee's accounting for a finance lease deal.

A: HERE IS THE ANSWER:

Q: What is leveraged lease?

A: A leveraged lease could be a rent deed that's financed by a third-party financial institution with…

Q: How does a leveraged lease differ from a nonleveraged lease?

A: A leveraged lease is an agreement that is partially financed by the third party creditor. In this…

Q: Define the term Finance Leases.

A: Lease is an agreement where one party permits or give rights to another party to use their land,…

Q: What are the advantages of lease?

A: A lease is a contract under the terms under which one party agrees to rent property owned by another…

Q: Explain Lease-versus-Own Analysis?

A: Owning is the right of an entitlement to an asset by purchasing it while leasing is the contract by…

Q: What is the difference between an “operating” and a “capital” lease? In easy terms please!

A: The criteria for defining the lease as a capital lease or operating lease   As per the notes issued…

Q: what is the value of the lease?

A: Value of Perpetual annuity = PMT/r PMT is the monthly payment r is the monthly compounded rate.…

Q: If the lessee and lessor use different interest rates to account for a finance/sales-type lease,…

A: Lease is agreement where lessor (asset owner) allows lessee (tenant) to use lessor’s asset for…

Q: Where can we obtain reliable guidelines on IFRS lease accounting?

A: It is dealing with where can we obtain reliable guidelines on IFRS lease accounting

Q: Describe the concept of direct financing lease.

A: Lease:   Lease is a contractual agreement whereby the right to use an asset for a particular period…

Q: What are the features of finance lease?

A: Lease:   Lease is a contractual agreement whereby the right to use an asset for a particular period…

Q: Describe the qualitative and quantitative lease disclosure?

A:

Q: Define Finance/Sales-Type Leases.

A: Lease: Lease is a contractual agreement whereby the right to use an asset for a particular period…

Q: Explain the nature, economic substance, and advantages of lease transactions.

A: Lease:   It is an agreement between two parties where the one party agrees to rent an asset owned by…

Q: From a lessee perspective, distinguish between a finance lease and an operating lease.

A: Lessees have available two lease accounting methods: (a) the operating method and (b) the…

Q: ect the le

A: Introduction : In simple words, leasing refers to the phenomenon under which an one entity use the…

Q: What are the pre-requisites of having a successful finance leasing?

A: Finance  leasing is the process wherein the finance company owns the asset legally throughout the…

Q: Would using a higher discount rate increase or decrease the amount of lease liability recorded?

A: Lease: A contractual agreement for an asset between two parties. The parties involved are lessee and…

Q: Why is lease financing sometimes referred to as off–balance sheetfinancing?

A: Lease is a type of an agreement that involves two parties i.e. owner (lessor) and lessee. In this…

Q: The term of a finance lease includes the initial lease term and any bargain renewal terms.    True…

A: The answer for the True or false question is discussed hereunder : What is a finance lease?  Finance…

Q: Leasing Cost Why the aftertax borrowing rate is the appropriate discount rate to use in lease…

A: Lease evaluation is the process where financial lease is evaluated on the basis of its feasibility…

Q: Explain Nonlease Components of Lease Payments.

A: Lease:   Lease is a contractual agreement whereby the right to use an asset for a particular period…

Q: Describe what if Lease Terms are modified?

A: Lease Terms are the terms on which both lessor and lessee agrees to enter into a specific lease. It…

Q: Define Finance lease

A: IAS 17 deals with the accounting for Leases.

Q: Explain the difference in lessee income statement and balance sheet presentation for a finance…

A: Lease agreement refers to an agreement in which a contract is made to get the asset on lease. The…

Q: Write down advantages and disadvantages of Lease financing.

A: Finance lease is for an essential term during which the arrangement can't be dropped. The length of…

Q: Explain the Uncertainty in Lease Transactions.

A: Uncertainty means something which is not certain and unusual in nature. There are various types of…

Q: Leasing Cost Explain why the aftertax borrowing rate is the appropriate discount rate to use in…

A: The borrowing rate is defined as the interest rate that includes many kinds of interest rates. The…

Q: Describe about the lease expenses in a finance lease?

A: Finance lease: The finance lease refers to the contract between two parties which satisfies the…

Q: What is the composition of lease Payments?

A: Lease is a kind of monthly rental payment made by the lessee to the lessor in return of the right to…

Q: What is the difference between an operating lease and a financial,or capital, lease?

A: Lease: Leases are agreements in which the proprietor of the asset permits another party to utilize…

Q: Which are the Factors Affecting Own-versus-Lease Decisions?

A: Owning an asset involves purchase of the asset using own or borrowed sources of funds, whereas…

Q: Why does a finance lease is economically similar to a purchase of the asset?

A: There are many similarities between purchase of a asset and Finance lease, such as: In a finance…

Q: What factors would tend to affect the value of a lease?

A: Lease is a contract between two parties in which one party lends its property or asset to the other…

Q: Describe the lessor's accounting for a direct financing lease.

A: Direct finance leasing: An agreement created between the nonmanufacturer and a lessee who use the…

Q: What discount rate should be used to evaluate a lease? Why?

A: Lease may be defined as the legal contract between two party's lessor and lessee, were one party…

Q: What if Lease Terms are Modified?

A: Lease terms is a contractual agreement or obligation that is prepared and signed by both lessor and…

Q: Compare and contrast a finance lease with an operating lease.

A: Lease:   It is an agreement between two parties where the one party agrees to rent an asset owned by…

Q: Explain the accounting for finance leases.

A: A lessee should categorize a lease as a finance lease when any of the following criteria are met:…

Q: When dealing in the world of mortgage pools and derivative investments, the notion of effective…

A: Effective duration usage is generally in the case of hybrid securities that can be further…

Q: Define the term Lease Financing?

A: Lease: Leases are agreements in which the proprietor of the asset permits another party to utilize…

Q: What is lease assignment? What is subletting? Explain at least one main difference between these…

A: In the world of finance in general and letting out of properties in particular the concepts of lease…

Q: What difference is between operating lease and finance leasing?

A: A lease is a financial agreement between two parties, i.e., lessor and lessee. A lessor is a person…

Q: What is financial lease?

A: Lease refers to the contract under which one party agrees to rent a property that is owned by…

Leasing

Leasing is a contractual arrangement in which someone (a lessee) pays the owner (or lessor) of a building, land, vehicle, or other asset for the use of that asset. The lease is the agreement between lessee and lessor.