Problem 1) What are the differences between a direct-financing and a sales-type lease for a lessor? Why would a lessor provide direct-financing to a lessee? What types of organizations provide direct-financing leases?
Problem 2) What is residual value? What is the implication to the lessee if the residual value is guaranteed or unguaranteed? What is the implication to the lessor?
Problem 3) What are the advantages of operating and capital leases? What are the disadvantages? Why would a company pick one over the other?