What is the cost of leasing

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Your landscaping company can lease a truck for $7,900 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 can earn on its funds is 6%. a. What is the cost of leasing? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Present value of lease $ b. Is it cheaper to buy or lease? Buy Lease c-1. What if the lease payments are an annuity due, so the first payment comes immediately? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Present value of lease $ c-2. Is it cheaper to buy or lease? Buy Lease

Reference no: EM131523408

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