What is the amount of the aftertax lease payment

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Reference no: EM13938820

Jamestown Supply is trying to decide whether to lease or buy some new equipment. The equipment costs $72,000, has a 4-year life, and will be worthless after the 4 years. The equipment will be replaced. The cost of borrowed funds is 9 percent and the tax rate is 34 percent. The equipment can be leased for $23,800 a year. What is the amount of the aftertax lease payment?

A. $13,897 B. $14,250 C. $14,667 D. $15,708 E. $15,820

Reference no: EM13938820

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