Discussion 5: Long-term Debt Financial Alternatives

Factors like collateral pledged, method of repayment, as well as other key factors should be considered when analyzing long-term debt. Long-term lease obligations have similar characteristics to long-term debt; however, both options are different from each other. Discuss the differences between long-term debt financing and long-term leasing. Under what circumstances would you choose between the two if put in a position to do so? Give an example.