Evaluation of Lease Decision: 3 Methods (with formula)
The methods used in evaluation of lease decision are as follows:- 1. Present Value Method 2. Cost of Capital Method 3. Bower-Herringer-Williamson Method. 1. Present Value Method: Under this method the present value of lease rentals are compared with the present value of the cost of an asset acquired on outright purchase by availing a loan. In leasing, the tax [...]