Would you recommend that lark buy or lease the asset

Assignment Help Financial Management

Reference no: EM131968294

Lark corporation is considering the acquisition of an asset for use in its business over the next five years. However, Lark must decide whether ti would be better served by leasing the asset or buying it. An appropriate asset could be purchased for $15,000.00 and it would qualify as a three-year asset under MACRS classification. Assume that the election to expense assets under section 179 is made, but any available additional first-year depreciation is not claimed, and that the asset is not expected to to have a salvage value at the end of its use by Lark. Alternatively, Lark coule lease the asset for a $3,625.00 annual cost over the 5-year period. If Lark is in the 34% tax bracket, would you recommend that Lark buy or lease the asset? In your calculations, assume that 10% is an appropriate discount factor.

Reference no: EM131968294

Questions Cloud

Second super bowl commercial : The price of a 30-second Super Bowl commercial is $5 million. Should you buy the advertisement?

How would you define environmental health : How would you define environmental health? What are at least 4 things you can do to prevent transmission of infectious diseases?

Identify international product and communication strategies : Identify the five international product and communication strategies available to firms that expand their businesses to foreign countries

Discuss the controversial issues related to the drug : Select one of the drugs discussed in your lesson. In your own words, discuss the controversial issues related to the drug and why these discussions.

Would you recommend that lark buy or lease the asset : Lark corporation is considering the acquisition of an asset for use in its business over next five years. would you recommend that Lark buy or lease the asset?

What are the aspects of a risk-benefits analysis : In your discussion, evaluate the employment of psychoactive drugs from the aspects of a risk-benefits analysis and ethical considerations such as the risk.

True academic performance of undergraduates : In light of this gaming, how can prospective employers and graduate schools determine the true academic performance of undergraduates?

Do teachers face a conflict of interest when certifying : What steps can schools and potential employers and graduate schools take to eliminate the problems created by these conflicts?

Contrast the structures of the qualitative dissertation : Write a paper in which you contrast the structures of the qualitative dissertation specific to your discipline with the structures .

User Account

All Pages