Each Team pays rent in the amount of 7% for years 1 and 2. In year 3, the teams ownership purchases the stadium at a Capitalization Rate of 5%. The team acquires the stadium with 25% cash and a 75% loan. The terms of the loan are:

Term: 10 Years

Amortization: 25 Years

Rate: 3.75%

The purchase of the stadium will require an adjustment to the Income Statement & Balance Sheet. However, if you elect NOT to purchase your stadium, it is acceptable. Just detail why in your assumptions or create a tab to explain.