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ABD is a leasing company. The lease calls for 9 payments of $1,543 per year with the first payment occurring immediately. The machine costs $8,334
ABD is a leasing company. The lease calls for 9 payments of $1,543 per year with the first payment occurring immediately. The machine costs $8,334 to buy. The present value of CCA tax shield is $1,357. The present value of its salvage value is $461 and the present value of the tax on terminal loss is $66. ABD firm can borrow at a rate of 10%. The corporate tax rate is 34%. What is ABD's NPV of leasing?
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