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Determine the net differential income

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Question - Keating Co. is considering disposing of equipment with a cost of $63,000 and accumulated depreciation of $44,100. Keating Co. can sell the equipment through a broker for $30,000, less a 9% broker commission. Alternatively, Gunner Co. has offered to lease the equipment for five years for a total of $46,000. Keating will incur repair, insurance, and property tax expenses estimated at $8,000 over the five-year period. At lease-end, the equipment is expected to have no residual value. Determine the net differential income from the lease alternative?

Reference no: EM133079446

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