Calculate the economics of leasing or buying (70%) Provide your recommend based on your calculation (30%) The
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Question:
Calculate the economics of leasing or buying (70%)
Provide your recommend based on your calculation (30%)
The facts of the case are as follows:
A. The lease:
Duration (in years)
Annual cost (before tax)
B. Financing and the purchase:
Cost of the assets
The useful life of the asset (in years)
Debt agreement
financing as % of total cost of asset
Repayment term
Interest rate
Residual value of the asset
Capital cost allowance
C. Assumption:
1. Corporate income tax rate
D
10 years
$250,000
$1,000,000
10 years
100%
10 years
6%
0
25%
35%
E
Related Book For
Auditing An International Approach
ISBN: 978-0071051415
6th edition
Authors: Wally J. Smieliauskas, Kathryn Bewley
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