Managerial Finance

Please respond to the following class mates post.1. Re: Topic 7 DQ 1There are about four types of leases out there but in most cases we only here about capital and operational are usually the types that are mostly talked about. There might be other reasons for this, but I believe these two types or lase unique and. If capital lease is considered to be load, so. what will operation lease be called?2. 1 postsRe: Topic 7 DQ 2According to Brigham and Ehrhardt (2014), managers must conduct a quantitative analysis in order to decide whether or not it is better to lease an asset or buy it. A qualitative analysis can be added into the decision making as well. Nonetheless depending on what the equipment or asset is there are advantages and disadvantages for both leasing and purchasing. Here we consider the benefits that leasing offer compared to the purchase of an asset.In the high school where I serve as a high school principal, there are two assets that we lease: copy machines, computers, and a school van. The benefits that I see in leasing versus purchasing allows us to focus on educational programs rather than worry primarily about managing certain assets. Leasing for our educational institution allows us to update our equipment especially for technology were it becomes obsolete quickly. This allows faculty and staff and students (as we are one-to-one school) to be equipped with the latest technology and programs. This allows flexibility for the kind of equipment that we need. For our school van, it is serviced regularly by the leasing company to the school so I do not need to worry about service and maintenance (Hayden, nd). The same service for our copy machines – the maintenance is included in the service lease contract. In general, because we also know the payments, it does become less expensive up front. Should I have purchased the copier machines, computers, and school van – I would be stuck with these assets as well as the service and maintenance. As I noted earlier, as an educator, my focus should be on students and their performance. I would prefer to work with leases for the various assets.ReferencesBrigham, E. and Ehrhardt, M. (2014). Financial Management Theory and Practice. Cengage Learning, Boston, MA.Hayden, A. (nd). Pros and cons of leasing vs. buying equipment. Quickbooks. Retrieved on September 15, 2019 from https://quickbooks.intuit.com/r/office-and-equipment/pros-cons-leasing-vs-buying-equipment/.

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