A sale and leaseback agreement is ____.
A) usually an operating lease
B) rarely used in today's leasing agreements
C) a method of providing liquidity for the lessee
D) frequently used for machinery financing, but rarely used in real estate

Question

Quizplus · Accepted Answer

A sale and leaseback agreement allows the lessee to sell an asset (such as real estate or machinery) to a lessor and then lease it back, providing liquidity for the lessee. It can be structured as an operating or finance lease, but the primary purpose is to generate cash for the lessee. It is commonly used in real estate financing, but can also be used for machinery or equipment.

A Sale and Leaseback Agreement Is ____