10.Your company is giving a building on lease for 7 payments of Rs 120,000 per year along...
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10.Your company is giving a building on lease for 7 payments of Rs 120,000 per year along with the first payment taking at inception. The building will cost Rs 1000,000 to buy it. The building will depreciate in 8 years with zero salvage value. While the borrowing interest rate is 6%. The lease is _________________. Single choice.
operating lease because there is no amortization.
operating lease because the asset will be obsolete.
financial lease because a huge amount of installment will be received each year.
financial lease because the lease life is greater than 75% of the economic life
Related Book For
Corporate Finance Core Principles and Applications
ISBN: 978-0077905200
3rd edition
Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Bradford
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