(CO E) Jack Sawyer is presently leasing a copier from John Office Equipment Company The lease requires 11 annual payments of $2,500 at the end of each year and provides the leaser (John) with an 8 return on its investment You may use the following 8 interest factors 9 Periods 10 Periods 11 Periods Future Value of 1 1 99900 2 15892 2 33164 Present Value of 1 50025 46319 42888 Future Value of Ordinary Annuity of 1 12 48756 14 48656 16 64549 Present Value of 1 6 24689 6 71008 7 13896 Present Value of Ordinary Annuity of 1 6 74664 7 24689 7 71008 (a) Assuming the computer has an 11 year life and will have no salvage value at the expiration of the lease, what was the original cost of the copier to John (b) What amount would each payment be if the 11 annual payments are to be made at the beginning of each period

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Question: (CO E) Jack Sawyer is presently leasing a copier from John Office Equipment Company. The lease requires 11 annual payments of $2,500 at the end

(CO E) Jack Sawyer is presently leasing a copier from John Office Equipment Company. The lease requires 11 annual payments of $2,500 at the end of each year and provides the leaser (John) with an 8% return on its investment. You may use the following 8% interest factors.

	9 Periods	10 Periods	11 Periods
Future Value of 1	1.99900	2.15892	2.33164
Present Value of 1	.50025	.46319	.42888
Future Value of Ordinary Annuity of 1	12.48756	14.48656	16.64549
Present Value of 1	6.24689	6.71008	7.13896
Present Value of Ordinary Annuity of 1	6.74664	7.24689	7.71008

(a) Assuming the computer has an 11-year life and will have no salvage value at the expiration of the lease, what was the original cost of the copier to John? (b) What amount would each payment be if the 11 annual payments are to be made at the beginning of each period?

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