Finance Lease


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Finance Lease

An agreement where the lessor receives lease payments to cover its ownership costs. The lessee is responsible for maintenance, insurance, and taxes. Some finance leases are conditional sales or hire purchase agreements.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Capital Lease

A long-term lease in which the lessee must record the leased item as an asset on his/her balance sheet and record the present value of the lease payments as debt. Additionally, the lessor must record the lease as a sale on his/her own balance sheet. A capital lease may last for several years and is not callable. It is treated as a sale for tax purposes. It is also called a financial lease.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
References in periodicals archive ?
Exhibit 1 illustrates a finance lease, including the calculations, amortization table, and required journal entries.
The award-winning Caddy continues to offer class-leading practicality and reliability in a compact, economical pack-pack age and is currently available through a range of finance solutions with monthly payments starting at PS190 a month on contract hire and finance lease, including a PS1,000 initial rental contribution.
Operating and finance lease revenues for the first quarter were USD178.3m, up USD17.8m or 11 percent year over year, due primarily to the revenue impact of aircraft acquisitions of USD38.0m, partially offset by lower revenues from aircraft sold of USD16.9m and the effect of lease extensions, transitions and terminations of USD3.4m.
There was also P1.18 billion in interest income on finance lease accounting for 17 hectares of building space while another P157.1 million was generated from the lease of 6.2 hectares of land.
The cumulative finance lease income of all leasing companies declined from Rs4.895 billion in FY2008 to Rs4.668 billion in FY2009, before nose-diving to Rs2.971 billion in FY2010, as funding issues started pinching them.
The proposed financing structure is a two-plus-five (2+5) year finance lease to partially finance one new Derrick Lay Ship DLS-4200 for NPCC.
The airline also mandated Al Hilal Bank, a new Islamic bank based in Abu Dhabi, to raise a further $110 million and provide a 12-year finance lease for the other plane.
The only leasing option that individuals have is HP, but companies have two types to choose from: a finance lease (which is in essence the same as HP) and an operating lease.
Under IAS, leases must be accounted for on the company's balance sheet as an asset and a liability if the company as the lessee enjoys the benefits and risks associated with that property in the same way as if they owned the property (that is, as if the property is held under a finance lease).
Benefiting from the robust income growth of its asset management, finance lease and financial services businesses, the Group's turnover increased by 14.4% to approximately RMB152.0 million, profit for the Period rose to approximately RMB80.0 million and basic earnings per share climbed to RMB1.74 cents.
The first quarter results included lease rental and finance lease revenues of USD 160.5m versus USD 152.2m in the first quarter of 2012.