What is the concept of sale-leaseback agreement?

Q: What is non-tax-oriented lease?

A: Non- tax Oriented lease: The lease where the lessor cannot avail tax exemptions for the capital…

Q: Why we will have a residual value in an operating lease?

A: Residual value is an estimated value of the asset at the end of lease term. In operating lease, we…

Q: Why is the cost of financing with a sale-leaseback essentially the same as the return from…

A: Introduction: Financing costs are nothing but the interest and other costs that the company incurred…

Q: What is guideline lease?

A: Guideline Lease:   A tax lease was drawn up under IRS models or "guidelines" to decide the…

Q: What is a sale-and-leaseback transaction?

A: Sale and leaseback is a deal in which the owner of an asset trades an asset, typically real estate,…

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: Why would a lease include a contingent payment provision? Explain.

A: Contingency payment provisions is a provision for a possible event or circumstance which is not…

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: What are the differences between capital leases and operating leases?

A: Solution:- Differences between capital leases and operating leases as follows under:-

Q: What is a synthetic lease?

A: The synthetic lease is a type of arrangement wherein the Parent company creates a separate entity…

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 value of the lease?

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

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: What is the difference between a tax-oriented lease and a nontax-oriented lease?

A: A tax-oriented lease: A tax-oriented lease, occasionally named a true lease, which offer the lessor…

Q: Does a lessee have an option not to separate lease and non lease components?

A: Lease: A lease or a lease agreement is a binding contract between two parties that dictates…

Q: Who are the two parties to a lease transaction?

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

Q: What are the features of lease?

A: The features of lease arrangements are, Residual type, Sale type leases, Bargain purchase option,…

Q: ect the le

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

Q: The basic concept of “substance over form” influences lease accounting. Explain

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

Q: What is the classification of operating lease?

A:

Q: What is meant by a term-loan agreement?

A: A Loan Agreement, also known as a term loan, demand loan, or loan contract. It basically is a legal…

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: Explain Effective Cost of the Sale-Leaseback?

A: Sales leaseback is a type of financial transaction where the owner sold its property to the other…

Q: What is selling profit on a sales-type lease? How do we account for a sales-type lease with a…

A: Sales-type lease: Sales type lease in equivalent type of direct financing whereby the owner (lessor)…

Q: Define sale-and-leaseback

A: sale-and-leaseback

Q: Can the present value of minimum lease payments differ between the lessor and lessee? If so, how?

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

Q: What is meant by Non-Cancellable lease?

A: Lease: It is an agreement between two parties in which one party agrees to give an asset on lease…

Q: What are the major advantages to a lessor for becoming involved in a leasing arrangement?

A: The Effect of Residual Values, Guaranteed and Unguaranteed is as follows: In setting the lease…

Q: How does the analysis of a sale-leaseback differ from the analysis of owning versus leasing?

A: A sale lease back is very beneficial for the company because it helps the company to sell the asset…

Q: How does a seller financing differ from a land contract ?

A: In the real estate context, seller financing means the seller transfer the title to the buyer of the…

Q: What is a combination lease?

A: Combination leases is also one of the type of leasing & is considered to be customized form of…

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: What are the two things that happened in the sale-leaseback agreement?

A: Sale and Leaseback Agreement is a kind of financial transaction. This is a situation that arises…

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: What are the characteristics of operating lease?

A: Definition: Operating lease: Operating lease is the type of lease in which the lessor allows the…

Q: Describe the lessee's accounting for sale-leaseback transactions.

A: Meaning:

Q: What is the requirement of the general description of the leasing arrangement?

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

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: Define the term Lease Financing?

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

Q: Explain the Existence of Ground Leases?

A: ntroduction: The land lease determines who owns the land, and who owns the house, as well as…

Q: What is the initial lease liability?

A: 1. Initial lease liability: Annual rental payable at the end of each year* Present value of an…

Q: Describe the concept of lease.

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

Q: Which are the General Contents of Leases?

A: Lease is a contract between two parties (lessor and lessee), where one party (lessor) gives right to…

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.