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A company needs new equipment which costs $50,000. It will last 5 years and then have no salvage value. The allowable CCA is 20 percent
A company needs new equipment which costs $50,000. It will last 5 years and then have no salvage value. The allowable CCA is 20 percent and the company has many assets of this type. The equipment can be leased for $11,000 a year, payable in advance. The tax rate is 40 percent and the after-tax cost of debt is 6 percent. What is the NPV of the lease?
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