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Leasing is an agreement where the lessor owns a capital asset but allows the lessee to use it for a specified period in exchange for payments. There are two main types of leases: operating leases where the lessee rents the asset, and finance leases where the lessee uses the asset for most or all of its useful life similar to ownership. The government provides various forms of assistance like grants to help businesses, especially in high-tech and high-unemployment areas. Venture capital is money invested in startups that could be lost if the business fails. Franchising allows businesses to expand using others' trade names with less upfront capital than establishing new locations themselves.

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Pradnyesh Ganu
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36 views1 page

Sourc

Leasing is an agreement where the lessor owns a capital asset but allows the lessee to use it for a specified period in exchange for payments. There are two main types of leases: operating leases where the lessee rents the asset, and finance leases where the lessee uses the asset for most or all of its useful life similar to ownership. The government provides various forms of assistance like grants to help businesses, especially in high-tech and high-unemployment areas. Venture capital is money invested in startups that could be lost if the business fails. Franchising allows businesses to expand using others' trade names with less upfront capital than establishing new locations themselves.

Uploaded by

Pradnyesh Ganu
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Leasing

A lease is an agreement between two parties, the "lessor" and the "lessee". The lessor owns a
capital asset, but allows the lessee to use it. The lessee makes payments under the terms of the
lease to the lessor, for a specified period of time.

Leasing is, therefore, a form of rental. Leased assets have usually been plant and machinery,
cars and commercial vehicles, but might also be computers and office equipment. There are two
basic forms of lease: "operating leases" and "finance leases".

Finance leases

Finance leases are lease agreements between the user of the leased asset (the lessee) and a
provider of finance (the lessor) for most, or all, of the asset's expected useful life.

Government assistance
The government provides finance to companies in cash grants and other forms of direct
assistance, as part of its policy of helping to develop the national economy, especially in high
technology industries and in areas of high unemployment. For example, the Indigenous
Business Development Corporation of Zimbabwe (IBDC) was set up by the government to
assist small indigenous businesses in that country.

Venture capital
Venture capital is money put into an enterprise which may all be lost if the enterprise fails. A
businessman starting up a new business will invest venture capital of his own, but he will
probably need extra funding from a source other than his own pocket.

Franchising
Franchising is a method of expanding business on less capital than would otherwise be needed.
For suitable businesses, it is an alternative to raising extra capital for growth.

Under a franchising arrangement, a franchisee pays a franchisor for the right to operate a local
business, under the franchisor's trade name.

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