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1. Preserves Cash
- no money "down".
2. Usually longer term available, resulting in,
lower monthly payment.
3. Fast and convenient -
less hassle than for long term "borrowing".
4. Tax benefits , such as faster write-off; more rapid
amortization than possible with "depreciation".
5. Provides cost-cutting or profit making equipment to
be installed immediately.
6. Pays for equipment out of before-tax savings rather
than after-tax profits.
7. Leverage - leaves
normal lines of bank credit undisturbed.
8. Avoids alternate corporate minimum tax.
9. May increase the firm's ability to acquire funds,
plus does not dilute ownership.
10. Creates or maintains working capital for inventory,
accounts receivable, other expenses.
National Business Institute reports a recent survey
indicates the Top Five Reasons for Choosing Leasing :
1 . *41%----Cash
flow---capital outlay.
2 . *18%----Rapid
technological changes cause product obsolescence.
3 .
*10%----Financial requirements are not as stringent.
4 . *10%----Leasing
companies are more accommodating than banks.
5 . *08%----Tax
implications.
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