lease vs. hire purchase

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

10 February 2011 dear experts i just want to know the difference between the leases and hire purchase.
the doubt occored wen i strted preparing for my group 2 accounts.. speciall in AS. so ur answer must be in dat that perview!
thanx in advance!

Kumar Babu.G

Kumar Babu.G (Expert)
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11 February 2011 Hire Purchase means at first we will make down payment and afterwards we will make installements.By the end we will get ownership on the asset.

In line with AS 19 ,in case of operating lease it is just like rental arrangement but in case of finance lease all significant risks and rewards will get transferred just like in hire purchase but payment terms get varied.