Lessor
Lessor classification of leases
- Please review criteria outlined before.
- Two types of capital leases exist for a lessor.
- Direct-financing (DF)
- Sales-type
- Difference between the DF and the Sales-type of lease is the presence of dealer’s profit (or manufacturer’s).
- Direct financing
- The PVMLP = asset cost.
- Companies are entering into lease agreement basically as a financing vehicle.