Difference between revisions of "Financial lease"
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Latest revision as of 04:35, 8 December 2020
Financial lease is a leasing agreement that covers the entire expected life of the equipment; does not provide for maintenance service, is not cancellable, and is fully amortized.
Definitions
According to Financial Management Theory and Practice by Eugene F. Brigham and Michael C. Ehrhardt (13th edition),
- Financial lease. Covers the entire expected life of the equipment; does not provide for maintenance service, is not cancellable, and is fully amortized.
According to Fundamentals of Financial Management by Eugene F. Brigham and Joel F. Houston (15th edition),
- Financial lease. A lease that does not provide for maintenance services, is not cancelable, and is fully amortized over its life; also called a capital lease.
Related concepts
- Financial management. A combination of enterprise efforts undertaken in order to procure and utilize monetary resources of the enterprise.
