Question: For the next two years, a lease is estimated to have an operating net cash inflow of $7,500 per annum, before adjusting for $5,000 per

For the next two years, a lease is estimated to have an operating net cash inflow of $7,500 per annum, before adjusting for $5,000 per annum tax basis lease amortization, and a 40% tax rate. The present value of an ordinary annuity of $1 per year at 10% for two years is 1.74. What is the lease’s after-tax present value using a 10% discount factor?

a. $ 2,610

b. $ 4,350

c. $ 9,570

d. $11,310

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