User Account

All Pages

What is the present value of the cost of leasing

Assignment Help Accounting Basics
Reference no: EM133021668

Question - Your landscaping company has lease a truck for $8,200 a year (paid at year-end) for 5 years. It can instead buy the truck for $35,000. The truck will be valueless after 5 years. The interest rate your company has earn on its fund is 6%.

a. What is the present value of the cost of leasing.

b. Is it cheaper to buy or lease?

c. What is the present value of the cost of leasing if the lease payment are an annuity due, so the first payment comes immediately?

d. Is it now cheaper to buy or lease?

Reference no: EM133021668

Questions Cloud

What the value of this swap to the party paying : The six-month LIBOR rate was 5.3% per annum (compounded semi-annually) two months ago. What the value of this swap to the party paying the fixed rate
At what amount should the payable be carried on primo books : On August 7, when the parts are received, the spot rate is $.028. At what amount should the payable be carried on Primo's books
What is the amount of the non-controlling interest : In December 2015, National Ltd paid a $20,000 dividend. What is the amount of the non-controlling interest in National Ltd as at 30 June 2016
What are the total variable costs : Asco Company has a relevant range of production between 15,000 and 30,000 units. If 18,000 units are produced, what are the total variable costs
What is the present value of the cost of leasing : What is the present value of the cost of leasing if the lease payment are an annuity due, so the first payment comes immediately
What are the net operating cash flows in years : The sprayer's base price is $1,030,000, and it would cost another $18,000 to install it. What are the net operating cash flows in Years 1, 2, and 3
How large will the cost per working hour be : In the coming year, it is estimated to work and charge customers a total of 12,000 hours, How large will the cost per working hour be
How much should you be willing to pay for the stock : The stock will then reach $33 per share. How much should you be willing to pay for the stock if you require a 15 percent return
What is the project NPV : Crane's tax rate is 34 percent, and its opportunity cost of capital is 10.30 percent. What is the project's NPV? Should the company purchase the saw

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +91-977-207-8620

Phone: +91-977-207-8620

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd