Can somone please word this in their own words and not from anyother site. Thanks.
Time Value of Money
The concept of time value of money is correspondingly beneficial in financing assessment, particularly when we deal with associating the cost of different sources of funding. The current rate of interest for each source of funding is established by the time value of money concept. In buying versus a leasing choice, we compute the present value of cost of purchase and cost of leasing. The present values of costs of these two possibilities are compared; the one that provides the least amount of cash outflows should be picked.Purchasing Equipment
When you purchase equipment it has its advantages. Owned equipment has tax depreciation benefits. Another advantage to buying assets is that it belongs to the company and does not have to be returned to the vendor (Turchetti, 2013). When a company owns assets they can choose to sell them when they are no longer useful to the firm.Can somone please word this in their own words and not from anyother site. Thanks.
Time Value of Money
The concept of time value of money is correspondingly beneficial in financing assessment, particularly when we deal with associating the cost of different sources of funding. The current rate of interest for each source of funding is established by the time value of money concept. In buying versus a leasing choice, we compute the present value of cost of purchase and cost of leasing. The present values of costs of these two possibilities are compared; the one that provides the least amount of cash outflows should be picked.
Purchasing Equipment
When you purchase equipment it has its advantages. Owned equipment has tax depreciation benefits. Another advantage to buying assets is that it belongs to the company and does not have to be returned to the vendor (Turchetti, 2013). When a company owns assets they can choose to sell them when they are no longer useful to the firm.