Finance Final Essay Example | Topics and Well Written Essays - 1000 words

Finance Final - Essay Example Leasing makes sense when one will try to look at it from the point of view of saving. If it is substantial to generate saving with leasing, then it makes sense to go for leasing than owning. In real situation, it is hard to own an asset by which depreciation may add up only to a remarkable cost. In this case, it is necessary to eliminate the associated cost with depreciation, which can be incurred if the owner will decide to own the asset. The good thing about leasing in this case is the opportunity for the individual to at least get rid of the remarkable costs associated with owning that may be addressed by just leasing an asset. At the bottom line, the CFO tries to look at the great impact of his financial decision on the organization in general. In this case, it is always a substantial consideration to understand the probable risks of a project or a certain investment. It is important on the part of the CFO to considerably analyze and look at the potential risks in the future. After all, he is always looking forward to sustainability in the future in order to continue the business operation and ensure effective development of strategies. Investment is something that is necessary to make sense from the point of view of the CFO. Therefore, if a project has certain potential for sustainability with considerable risks involved then the CFO will most likely drink to that. The three dividend theories are dividend irrelevance theory, bird-in-the-hand theory, and tax-preference theory. The dividend irrelevance theory puts forward the main point that without taxes or bankruptcy costs the prevailing dividend policy can be irrelevant at some point. The bird-in-the-hand theory suggests that dividend is relevant, because the retained earnings will further give the firm a brighter investment in the future. The tax-preference theory on the other hand suggests that