Which of the following statements represents a potential advantage to leasing?

Question

Quizplus · Accepted Answer

Leasing provides a potential tax advantage if the lessee is unable to utilise depreciation deductions fully if the asset is purchased. This advantage arises because the lessor can claim depreciation deductions and pass on the tax benefits to the lessee in the form of reduced lease payments. Additionally, the lessor can bear the risks and costs associated with maintaining and operating the leased asset, relieving the lessee of these responsibilities. Option A and Option D are incorrect, as they do not provide a specific advantage. Option B is incorrect because a tax advantage exists when the lessee and lessor are taxed at different rates, not the same rate.

Which of the Following Statements Represents a Potential Advantage to Leasing