Asked by sauli Lianga on Jul 20, 2024
Verified
All else equal, the lower the cost of the equipment to be leased, the greater the net advantage to leasing (NAL) to the lessee.
Net Advantage to Leasing
A financial concept that compares leasing to purchasing, calculating the costs saved or incurred over the lease term.
Equipment Cost
The total expenditure incurred to purchase, install, and make operational a piece of equipment.
- Familiarize yourself with the cost-saving and tax benefits of deciding on leasing rather than purchasing.
Verified Answer
PR
Priyanka RizalJul 22, 2024
Final Answer :
False
Explanation :
The net advantage to leasing (NAL) is determined by comparing the cost of leasing to the cost of purchasing. Lower equipment cost does not automatically mean a greater NAL; factors like lease terms, interest rates, and tax implications also play significant roles.
Learning Objectives
- Familiarize yourself with the cost-saving and tax benefits of deciding on leasing rather than purchasing.
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