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WHAT IS THE EFFECTIVE INTEREST RATE FOR RENTAL/ OPERATING LEASES?

April 26, 2017effective Interest rate leases operating rental

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WHAT IS THE EFFECTIVE INTEREST RATE FOR RENTAL/ OPERATING LEASES?

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Operating leases are different from loans, so there is no interest rate. It is usage that generates profit, not ownership, which is why in the case of operating lease, your customer is paying for the use of the equipment over a fixed term.