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c. Give explanation to LTB on TWO (2) advantages of leasing. Lompat Tikam Berhad (LTB) wants to purchase a new network file server for its
c. Give explanation to LTB on TWO (2) advantages of leasing. Lompat Tikam Berhad (LTB) wants to purchase a new network file server for its wide-area computer network. The server costs RM65,000. It will be completely obsolete in three years. LTB is having an alternative to borrow the money at 10 percent or to lease the server. If LTB lease, the payments will be at RM27,000 per year, payable at the end of each of the next three years. If LTB buy the server, LTB can depreciate the server using straight-line to zero over three years. The tax rate is 40 percent
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