When the lessor calculates the periodic lease payments, the present value of the bargain purchase option should be: subtracted from the amount to be recovered through periodic rental payments
Lease payments are formally required by agreements between two parties that grant one participant the legal right to use the other person's real estate, manufacturing equipment, computers, software, or other property for a specified period of time. Equivalent to monthly rent.
On the surface, leasing is more attractive than buying. Because there is no principal repayment, monthly payments are usually lower. Instead, you simply borrow and pay the difference between the car's new value, the car's residual value (expected value at the end of the contract), and the cost of financing.
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