Equipment Leasing
Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Accounting and Financial Management for Bankers — JAIIB.
One-liners from this chapter
Free sample — 8 of 72 rapid-fire Q&A cards.
Lessor?
The party which owns the property and grants the right to use it.
Lessee?
The party which gets the right to use the asset against payment of rent.
Lease Rental?
The agreed periodic payment made by the lessee to the lessor for use of the property.
Lease Term?
The fixed period for which the lessee has the right to use the asset.
Underlying Asset?
The identified asset that is the subject of the lease contract.
Breaking a lease contract involves legal consequences?
termination clauses, penalty payments and notice-period rules govern any early exit.
Transfer of risks & rewards — Finance Lease / Operating Lease?
Finance Lease: Transferred to lessee; Operating Lease: Retained by lessor
Ownership at end — Finance Lease / Operating Lease?
Finance Lease: Often transfers to lessee; Operating Lease: Stays with lessor
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