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Larkspur Inc., manufactures ice tea and would like to increase its market share in the North. In order to do so, Larkspur has decided to

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Larkspur Inc., manufactures ice tea and would like to increase its market share in the North. In order to do so, Larkspur has decided to locate a new factory in the Cedar Rapid area. Larkspur will either buy or lease a site depending upon which is more advantageous. The site location committee has narrowed down the available sites to the following three buildings. Building A: Purchase for a cash price of $1,547,000, useful life 28 years. Building B: Lease for 28 years with annual lease payments of $123,000 being made at the beginning of the year. Building C: Purchase for $1,962,000 cash. This building is larger than needed; however, the excess space can be sublet for 28 years at a net annual rental of $19,400. Rental payments will be received at the end of each year. Larkspur Inc. has no aversion to being a landlord. Click here to view factor tables In which building would you recommend that Larkspur Inc. locate, assuming a 12% cost of funds? (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 2 decimal places, e.g. 4,585.81.) Net Present Value Building A $ Building B $ Building $

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