How can leasing allow a firm to effectively depreciate land

Assignment Help Financial Management

Reference no: EM13926828

1. How can leasing allow a firm to effectively "depreciate" land?

2. What effect does leasing have on the stability of a firm's reported earnings?

3. It has been argued that leasing is almost always more expensive than borrowing and owning. Do you think this is true? Why or why not? Under what circum- stances is leasing likely to be more desirable than direct ownership?

4. Why do you think it is easier for firms with weak credit positions to obtain lease
financing than bank loan financing?

5. Under what circumstances might a firm prefer intermediate-term borrowing to either long- or short-term borrowing?

6. Discuss the advantages and disadvantages of the following types of term loans:

a. Those that require equal periodic payments

b. Those that require equal periodic reductions in outstanding principal

c. Balloon loans

d. Bullet loans.

Reference no: EM13926828

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