Also simply known as an "FMV", this leasing program may qualify for off-balance-sheet accounting treatment, but it depends on how it is structured. We recommend that you consult your accounting advisor for advice on book treatment. At the end of the term, there is a remaining balance (also known as a "balloon payment") and you have a few options:
Referred to as a $10 Buyout Lease in Canada, this program is known in the United States under a few terms: $1 Out, $1 Purchase Option, $1 Buyout, or Capital Lease. From an accounting standpoint, this lease is treated as a liability on your balance sheet with tax benefits being taken in the form of depreciation. At the end of term, you are obligated to purchase the leased item for $1 (or $10 in Canada, respectfully). This program is best suited for customers who prefer technology ownership and know that upfront entering the lease term.