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    Treatment of Hire-Purchase in the Financial Statement

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    How Is Hire-Purchase recorded in the Financial Statement? as an asset or liability or something else and WHY?

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    Hire Purchase is a method of acquiring assets without having to invest the full amount in buying them. Typically, a hire purchase agreement allows the hire purchaser sole use of an asset for a period after which they have the right to buy them, often for a small or nominal amount. The benefit of this system is that companies gain immediate use of the asset without having to pay a large amount for it or without having to borrow a large amount.

    Hence Hire ...

    Solution Summary

    This discusses the treatment of Hire-Purchase in the Financial Statement