One of the main reasons for firms entering into an operating lease as the lessee is:

Question

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One of the main reasons for firms entering into an operating lease as the lessee is uncertainty about the length of time for which the asset is required. Unlike a finance lease, an operating lease is not a long-term commitment, and the lessee can return the asset or upgrade to a new one at the end of the lease term without taking on the risks associated with owning the asset. This flexibility is especially important for firms that operate in industries with rapidly changing technology or markets, where the useful life of an asset can be difficult to predict. Operating leases also offer tax advantages, but this is not the main reason for choosing this type of lease.

One of the Main Reasons for Firms Entering into an Operating