Accounting / July 19, 2018 / Pearl Bailey
As a businessperson, the commercial lease you sign for your business is one of the most important documents you'll ever create. Take the time to learn the clauses you should expect to see in any commercial lease and what those clauses mean.
A capital lease is a lease in which the lessor only finances the leased asset, and all other rights of ownership transfer to the lessee. This results in the recordation of the asset as the lessee's property in its general ledger, as a fixed asset. The lessee can only record the interest portion of a capital lease payment as expense, as opposed to the amount of the entire lease payment in the case of the more common operating lease.
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