Why is a short term lease or rental of property an attractive way for a business to acquire the use of equipment for a particular task or period of time?
A) A lease protects creditors whether the arrangement is contractual or not.
B) A lease is a form of sale and is covered by the large number of terms implied through legislation governing the sale of goods
C) It makes little sense to purchase something that is not needed for a long period,unless,of course,the rental charges approach the cost of buying.
D) The lessee must take reasonable care of the property while that property is in its possession and return it in the state that would be expected

Question

Quizplus · Accepted Answer

Leasing or renting equipment for a short term is cost-effective for businesses when the equipment is not needed for a long period. This approach avoids the unnecessary expenditure of purchasing equipment that will only be used temporarily, provided that the rental costs do not approach the purchase price.

Why Is a Short Term Lease or Rental of Property