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eBook Show Me How Print Item Question Content Area Lease or Sell Ferrigno Company owns equipment with a cost of $361,900 and accumulated depreciation of
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Lease or Sell
Ferrigno Company owns equipment with a cost of $361,900 and accumulated depreciation of $54,400 that can be sold for $273,600, less a 5% sales commission. Alternatively, Ferrigno Company can lease the equipment to another company for three years for a total of $285,100, at the end of which there is no residual value. In addition, the repair, insurance, and property tax expense that would be incurred by Ferrigno Company on the equipment would total $15,900 over the three years.
Question Content Area
Prepare a differential analysis on March 23 as to whether Ferrigno Company should lease (Alternative 1) or sell (Alternative 2) the equipment. For those boxes in which you must enter subtracted or negative numbers use a minus sign.
Lease Equipment (Alternative 1) | Sell Equipment (Alternative 2) | Differential Effect (Alternative 2) | |
Revenues | $fill in the blank 6d463e06c057076_1 | $fill in the blank 6d463e06c057076_2 | $fill in the blank 6d463e06c057076_3 |
Costs | fill in the blank 6d463e06c057076_4 | fill in the blank 6d463e06c057076_5 | fill in the blank 6d463e06c057076_6 |
Profit (loss) | $fill in the blank 6d463e06c057076_7 | $fill in the blank 6d463e06c057076_8 | $fill in the blank 6d463e06c057076_9 |
Question Content Area
Should Ferrigno Company lease (Alternative 1) or sell (Alternative 2) the equipment?
Lease the equipmentSell the equipment
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