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ASB is considering leasing a new machine. The lease calls for 9 payments of $1,402 per year with the first payment occurring immediately. The machine
ASB is considering leasing a new machine. The lease calls for 9 payments of $1,402 per year with the first payment occurring immediately. The machine costs $8,084 to buy. The present value of CCA tax shield is $1,035. The present value of its salvage value is $494 and the present value of CCA recapture is $90. ASB firm can borrow at a rate of 10%. The corporate tax rate is 30%. What is the NPV of leasing?
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