bargain purchase option definition

bargain purchase option

Stipulation in a lease agreement that gives a lessee the right to purchase the leased asset at the end of the lease term, at a cost substantially lower than its estimated fair market value at that time. According to the Financial Accounting Standards Board, if a non-cancelable lease has a bargain-purchase option, it must be classified as a capital lease.

bargain purchase option is in the Banking, Commerce & Finance and Real Estate & Buildings subjects.

bargain purchase option appears in the definition of the following term: capital lease

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