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متابعة

What is the distinguish between an operating lease and a capital lease?

Capital lease

A lease agreement transfers substantially all the benefits and risks of ownership of the asset to the lessee if at least one of the following criteria is met:

1) The lease provides for the transfer of ownership of the leased property.

2) The lease contains a bargain purchase option (BPO).

3) The lease term is% or more of the estimated economic life of the leased property.

4) The present value of the minimum lease payments is at least% of the fair value of the leased property

It increase assets and liabilities into balance sheet

Operating lease

- If the long-term lease does not meet any of the above criteria.

- In an operating lease, the lessor retains substantially all of the benefits and risks of ownership. Such a lease is a regular rental agreement

 

-The lessee reports periodic rental expense for the amount of rent paid, but no leased asset or liability is recognized (it increases expense , therefore affecting income)

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تم إضافة السؤال من قبل Mohamed Abd El Fattah , Manager of Cash Budget Management , الشركة المصرية للاتصالات
تاريخ النشر: 2023/01/08
Syed Momin Ali
من قبل Syed Momin Ali , Transport Manager , Agriona

An operating lease is treated like renting ... Payments are considered operational expenses and the asset being leased stays off the balance sheet. In contrast, a capital lease is more like a loan,the asset is treated as being owned by the lessee so its stays on  the balance sheet.

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هل تحتاج لمساعدة في كتابة سيرة ذاتية تحتوي على الكلمات الدلالية التي يبحث عنها أصحاب العمل؟