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1.The company’s asset will be removed from the balance sheet which will in essence affect its financial position i.e reflect a bad financial picture.
2.The lessee may not enjoy the benefits of wear and tear as such this will increase his tax liability.
3.The finance is limited to the cost of the asset leased, and cannot be versatile.
4.If it is an operating lease, then it will be used for short-term purpose.
5.It entails implicit costs such as repairs and maintenance costs of the asset leased.
sharon kalunda answered the question on April 16, 2019 at 14:24
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