Distinguish between “leasing” and “hire purchase” highlighting how each is accounted for.

      

Distinguish between “leasing” and “hire purchase” highlighting how each is accounted for.

Answers


Wilfred
In hire purchase the title the goodwill pass to the buyer on payment of the last installment but in lease the title will not pass to the leasee.
1. In hire purchase the asset acquired is recognized in the books of the buyer while lease the asset is recognized in the books of the lessor.
2. Maintenance and other capital cost in H.P are incurred by the buyer but in lease capital cost are incurred.
Wilfykil answered the question on February 11, 2019 at 07:51


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