Please help, and show work, thank you!

4. Rent versus buy home. Use Worksheet 5.2. Amelia Flores is currently renting an apartment for S725 per month and paying $275 annually for renter's insurance. She just found a small townhouse she can buy for $185,000. She has enough cash for a $10,000 down payment and $4,000 in closing costs. Amelia estimated the following costs as a percentage of the home's price: property taxes, 2.5 percent; homeowner's insurance 0.5 percent; and maintenance, O.7 percent. She is in the 25 percent tax bracket. Calculate the cost of each alternative and recommend the least costly option-rent or buy-for Amelia. Question 4(worksheet 5.2) RENT-OR-BUY ANALYSIS A. COST OF RENTING 1. Annual rental costs 12 x monthly rental ras) 2. Renters insurance 3. Opportunity cost of security deposit. after-tax savings rate Total cost of renting (line A.1 + line A.2+ line A.3) B. COST OF BUYING months 1. Annual mortgage payments (Terms ( 12 x monthly mortgage payment o, 2. Property taxes ( % of price of home) - 3. Homeowner's insurance % of price of home) 4. Maintenance ( % of price of home) - 5. After-tax cost of interest on down payment and closing costs % after-tax rate of return) 6. Total costs (sum of lines B.1 through B.5) Less: 7. Principal reduction in loan balance (see note below) 8. Tax savings due to interest deductions* tax rate of (Interest portion of mortgage paymen $ 9. Tax savings due to property tax deductions* (line B.2 x tax rate of 10. Total deductions (sum of lines B.7 through B.9) 11. Annual after-tax cost of home ownership (line B.6 - line B.10) 12. Estimated annual appreciation in value of home 96 of price of home) Total cost of buying (line B.11 - line B.12 Note: Find monthly mortgage payments from the Exhibit in chapter 5 of your textbook. An easy way to approximate of the annual loan payment that goes to interest (line B.8) is to multiply the interest rate by the size of the loan. 1o principal in the loan balance (line B.7), simply subtract the amount that goes to interest from total annual mortgage payments. Tax-shelter items 4. Rent versus buy home. Use Worksheet 5.2. Amelia Flores is currently renting an apartment for S725 per month and paying $275 annually for renter's insurance. She just found a small townhouse she can buy for $185,000. She has enough cash for a $10,000 down payment and $4,000 in closing costs. Amelia estimated the following costs as a percentage of the home's price: property taxes, 2.5 percent; homeowner's insurance 0.5 percent; and maintenance, O.7 percent. She is in the 25 percent tax bracket. Calculate the cost of each alternative and recommend the least costly option-rent or buy-for Amelia. Question 4(worksheet 5.2) RENT-OR-BUY ANALYSIS A. COST OF RENTING 1. Annual rental costs 12 x monthly rental ras) 2. Renters insurance 3. Opportunity cost of security deposit. after-tax savings rate Total cost of renting (line A.1 + line A.2+ line A.3) B. COST OF BUYING months 1. Annual mortgage payments (Terms ( 12 x monthly mortgage payment o, 2. Property taxes ( % of price of home) - 3. Homeowner's insurance % of price of home) 4. Maintenance ( % of price of home) - 5. After-tax cost of interest on down payment and closing costs % after-tax rate of return) 6. Total costs (sum of lines B.1 through B.5) Less: 7. Principal reduction in loan balance (see note below) 8. Tax savings due to interest deductions* tax rate of (Interest portion of mortgage paymen $ 9. Tax savings due to property tax deductions* (line B.2 x tax rate of 10. Total deductions (sum of lines B.7 through B.9) 11. Annual after-tax cost of home ownership (line B.6 - line B.10) 12. Estimated annual appreciation in value of home 96 of price of home) Total cost of buying (line B.11 - line B.12 Note: Find monthly mortgage payments from the Exhibit in chapter 5 of your textbook. An easy way to approximate of the annual loan payment that goes to interest (line B.8) is to multiply the interest rate by the size of the loan. 1o principal in the loan balance (line B.7), simply subtract the amount that goes to interest from total annual mortgage payments. Tax-shelter items