Acquisition Decision Johnson Company is considering acquiring a new airplane. It has looked at two financing options.

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Acquisition Decision Johnson Company is considering acquiring a new airplane. It has looked at two financing options. The first is to lease the airplane for 10 years with lease payments of $70,000 each year. The second is to purchase the airplane, making a down payment of $250,000 and annual payments of $40,000 for 10 years. If the present value of the two financing options is the same, what other factors must be considered in deciding whether to purchase or to lease?

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Accounting Concepts And Applications

ISBN: 9780324376159

10th Edition

Authors: W. Steve Albrecht, James D. Stice, Earl K. Stice, Monte R. Swain

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