Banff Corporation is a new graphic design business.It requires computers to do the graphic design work and is trying to decide how to acquire them.One option is to buy the computers from a store and borrow the money they need from the bank.A second option is to lease the computers from another company that specializes in the leasing of office equipment.The leasing company is offering a two-year lease that they could renew or change when it expired.The computers they are interested in have a physical life of five years, but Banff wants to make sure that it always has current equipment to remain competitive.The two owners have approached you to help them decided.They want to consider the impact on their financial statements as well as the technical requirements of the computers when they decide.
Required:
A) Evaluate, from Banff's perspective, the two options that are available.B) Which would you recommend? Why?

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The Answer of Banff Corporation is a new graphic design business.It requires computers to do the graphic design work and is trying to decide how to acquire them.One option is to buy the computers from a store and borrow the money they need from the bank.A second option is to lease the computers from another company that specializes in the leasing of office equipment.The leasing company is offering a two-year lease that they could renew or change when it expired.The computers they are interested in have a physical life of five years, but Banff wants to make sure that it always has current equipment to remain competitive.The two owners have approached you to help them decided.They want to consider the impact on their financial statements as well as the technical requirements of the computers when they decide.
Required:
A) Evaluate, from Banff's perspective, the two options that are available.B) Which would you recommend? Why?

Banff Corporation Is a New Graphic Design Business