Written by Administrator

Financing

Leasing/Financing Advantages
Park Industries works with a variety of sources to help add high-performance machines to customer's operations.

Leasing Leverages Your Cash Flow
An equipment lease is an equipment financing option in which a lease company retains ownership of the equipment in exchange for monthly rental payments. Research suggests that about 80 percent of American corporations lease equipment. It’s a tried-and-true method of generating profit. Owning equipment has limited value compared to actually using the equipment. Without buying outright or borrowing money and leasing instead, a company's cash and equity isn't tied up in equipment.

Tax Opportunities
Lease payments may be considered pretax dollars and fully deductible operating expenses. Leasing may eliminate the need for complicated depreciation schedules and could accelerate tax benefits. You also may avoid the Alternative Minimum Tax by paying for the equipment out of current, untaxed income instead of from pretaxed profits. The more profitable the company, the greater advantage of a lease. Consult your tax advisor to evaluate your potential deduction benefits. As your company prepares its annual financial reports, you’ll see that leasing provides some additional opportunities. Leased equipment is its own collateral.

Off Balance Sheet
Financing: A capital purchase must be listed as an asset and a corresponding liability. As years pass, depreciation and interest expenses have to be accounted for. Leased equipment is not required to be capitalized in financial statements. Leased equipment is footnoted, so a company's financial ratios and measurements improve. Leased equipment does not create a liability, so the company appears less leveraged.

Increased Return on Assets: Leasing doesn't increase a lessee's asset base, which allows a company to report a higher return on assets.

Improved Cash Forecasting: Leasing payments are locked in for the term, eliminating uncertainties regarding the future cost of equipment.

Leasing/Financing Vendors
Here is a short list of financial vendors that you could consult for any financing needs. Park Industries does not endorse any one vendor over another. These names are being provided for your independent research and use.

American Equipment Finance LLC
800-785-3060 x 204
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Leasing Advantages
800-592-7348

Northland Capital Equipment Leasing
800-471-2122
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During or at the end of a lease, you have the option to upgrade to a more technologically advanced machine. If you are going to upgrade, a simple phone call and the remaining principal balance of the old equipment is added to a new lease. Park makes it easy to stay competitive.