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7/29/2019 leasing and hire purchase.pptx
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LEASING AND HIRE PURCHASE
Presented by :
Abhishek Saran
Maharath Mayukh
Amit Kumar Jayaswal Anuj Jha
Yogeshwar Tiwari
Aditya Shukla
MBA 4th semester (2012-13)
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Definition of leasing
Process by which a firm, can obtain the use of
certain fixed asset, for which it must make a
series of contractual and periodic payments.
Lessor
Lessee
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Essential elements
Parties to the contract
Asset
Ownership separated from user
Term of lease
Lease rentals
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Types of leasing
Finance lease : it is for terms that approacheconomic life of asset.
Total payments over term of lease > lessors
initial cost of leased asset Operating lease : for a term, shorter than
economic life of the asset.
Total payments over term of lease