StephenRoss公司理财21.pptVIP

Chapter Outline 21.1 Types of Leases 21.2 Accounting and Leasing 21.3 Taxes and Leases 21.4 The Cash Flows of Leasing 21.5 A Detour on Discounting and Debt Capacity with Corporate Taxes 21.6 NPV Analysis of the Lease-versus-Buy Decision 21.7 Debt Displacement and Lease Valuation 21.8 Does Leasing Ever Pay: The Base Case 21.9 Reasons for Leasing 21.10 Some Unanswered Questions 21.1 Types of Leases The Basics A lease is a contractual agreement between a lessee and lessor. The agreement establishes that the lessee has the right to use an asset and in return must make periodic payments to the lessor. The lessor is either the asset’s manufacturer or an independent leasing company. Operating Leases Usually not fully amortized. This means that the payments required under the terms of the lease are not enough to recover the full cost of the asset for the lessor. Usually require the lessor to maintain and insure the asset. Lessee enjoys a cancellation option. This option gives the lessee the right to cancel the lease contract before the expiration date. Financial Leases The exact opposite of an operating lease. Do not provide for maintenance or service by the lessor. Financial leases are fully amortized. The lessee usually has a right to renew the lease at expiry. Generally, financial leases cannot be cancelled, i.e., the lessee must make all payments or face the risk of bankruptcy. Sale and Lease-Back A particular type of financial lease. Occurs when a company sells an asset it already owns to another firm and immediately leases it from them. Two sets of cash flows occur: The lessee receives cash today from the sale. The lessee agrees to make periodic lease payments, thereby retaining the use of the asset. Leveraged Leases A leveraged lease is another type of financial lease. A three-sided arrangement between the lessee, the lessor, and lenders. The lessor owns the asset and for a fee allows the lessee to use the asset. The lessor borrows to partially finance the asset. Th