Lease vs. Buy Analysis

May 5th, 2015
Studypool Tutor
Price: $10 USD

Tutor description

Case #34: Lease versus Buy Analysis Why Buy It When You Can Lease It? David Bajak Katrina Bishop Gary Hsieh Question 1: What are the different kinds of leases available and which one would be best suited for Paulo’s restaurant? Explain why?

Word Count: 2133
Showing Page: 1/17
Lease vs. Buy AnalysisCase#34: LeaseversusBuyAnalysis WhyBuyItWhenYouCanLeaseIt? DavidBajak KatrinaBishop GaryHsieh Question1:WhatarethedifferentkindsofleasesavailableandwhichonewouldbebestsuitedforPaulo'srestaurant?Explainwhy? Therearetwomajortypesofleases:operatingleaseandfinanciallease. Anoperatingleaseplacestheresponsibilityofmaintenanceandrepairsonthelessor,hasalifespanofnomorethan5years,andisusually cancellable. Afinancialleaseplacestheresponsibilityofmaintenanceandrepairsonthelesseeandisusuallynoncancellableandfullyamortized.Tax- orientedlease,sale-and-leasebacklease,andleverageleaseareallexamplesoffinancialleases. - Asale-and-leasebackleaseisaformoftemporaryborrowing,whichallowstheownerofanassettoselltheassettoanothercompany andleaseitbackforaspecifiedperiod. - Underatax-orientedleasethelessorwillbetreatedbytheIRSastheowneroftheleasedpropertyforfederaltaxpurposesand permittedtotaketaxbenefits. - Aleveragedleaseallowsthelessortoborrowaportionofthefundsneededtobuytheequipmenttobeleased. AnoperatingleasewouldbebestsuitedforPaulo'srestaurant.Underanoperatinglease,Paulowouldbeabletoreturntheequipmentand cancelthecontractifneeded.Theequipmentwouldnothavetobelistedasaliabilityorassetonhisbalancesheet.Also,

Review from student

Studypool Student
" awesome work thanks "
Ask your homework questions. Receive quality answers!

Type your question here (or upload an image)

1829 tutors are online

Other Documents

05/05/2015
05/05/2015
05/05/2015
05/05/2015
05/05/2015
05/05/2015
05/05/2015
05/05/2015

Brown University





1271 Tutors

California Institute of Technology




2131 Tutors

Carnegie Mellon University




982 Tutors

Columbia University





1256 Tutors

Dartmouth University





2113 Tutors

Emory University





2279 Tutors

Harvard University





599 Tutors

Massachusetts Institute of Technology



2319 Tutors

New York University





1645 Tutors

Notre Dam University





1911 Tutors

Oklahoma University





2122 Tutors

Pennsylvania State University





932 Tutors

Princeton University





1211 Tutors

Stanford University





983 Tutors

University of California





1282 Tutors

Oxford University





123 Tutors

Yale University





2325 Tutors