Question: Differential Analysis for a Lease or Sell Decision Burington Construction Compary is considering seling excess machinery with s book value of $115,000 (original cost of
Differential Analysis for a Lease or Sell Decision Burington Construction Compary is considering seling excess machinery with s book value of $115,000 (original cost of $275,000 less accumulated depredation of - $160,000 ) for $90,000, less a 6% brokerage commission. Alternatively, the machinery can be leased for a total of $100,000, for four years, after which it is expected to have no residual value, During the period of the lease, Burington. Construction Compary's costs of repairs, insurance, and property tax expensea are expected to be $9,000. 3. Prepare a differentiat analysis dated January 15 to determine whether Burfington Constouction Company should lease (Alternative 1 ) or seil (Aternative 2 ) the machinery. If required, use a minus sign to indicate a loss. Differential Analvsis reedous: T Oreck Mr Wore the revenues, costs, and income (loss) by subtracting altemative 1 from alternative 2 . b. On the basis of the data presented, would it be advisable to lease or seil the machinery
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