Capital Lease

Capital Leases are the rented ownership of any form of capital asset (machinery, equipment, factories etc.) that adds value to the company. For accounting purposes, capital leases are included in assets. When calculating Enterprise Value, Capital Leases must be included into EV as they are effectively a debt to be paid.

Free Resources

To continue learning and advancing your career, check out these additional helpful WSO resources:

• Retained Earnings
• Fraud Triangle
• Accounts Receivable Turnover Ratio
• Marginal Cost Formula
• Nash Equilibrium