Brentwood Industries is selling its tool and die equipment to Upward Financial and then leasing that equipment from Upward for a period of 10 years, which is the useful remaining life of the equipment. Which type of lease arrangement is this?

Question

Quizplus · Accepted Answer

This is a sale and leaseback arrangement where Brentwood Industries is selling its equipment to Upward Financial and then leasing it back for a period of 10 years. This allows Brentwood to free up cash by selling the equipment and then continue to use it by leasing it back.

Brentwood Industries Is Selling Its Tool and Die Equipment to Upward