Sloan Corporation is considering new equipment. The equipment can be purchased from an overseas supplier for $3,160. The freight and installation costs for the equipment are $640. If purchased, annual repairs and maintenance are estimated to be $390 per year over the four-year useful life of the equipment. Alternatively, Sloan can lease the equipment from a domestic supplier for $1,460 per year for four years, with no additional costs.

Prepare a differential analysis dated December 3, to determine whether Sloan should lease (Alternative 1) or purchase (Alternative 2) the machine. (Hint:This is a "lease orbuy" decision, which must be analyzed from the perspective of the machine user, as opposed to the machine owner.) If an amount is zero, enter "0". Use a minus sign to indicate a loss.

Differential AnalysisLease Equipment (Alt. 1) or Buy Equipment (Alt. 2)December 3Lease Equipment (Alternative 1)Buy Equipment (Alternative 2)Differential Effect on Income (Alternative 2)Revenues$$$Costs:Purchase price$$$Freight and installationRepair and maintenance (4 years)Lease (4 years)Income (loss)$$$

Determine whether Sloan should lease (Alternative 1) or buy (Alternative 2) the equipment.

Differential Analysis for a Lease or Buy Decision Sloan Corporation is considering new equipment. The equipment can be purchased from an overseas supplier for $3,160. The freight and installation costs for the equipment are $640. If purchased, annual repairs and maintenance are estimated to be $390 per year over the four-year useful life of the equipment. Alternatively, Sloan can lease the equipment from a domestic supplier for $1,460 per year for four years, with no additional costs. Prepare a differential analysis dated December 3, to determine whether Sloan should lease (Alternative 1) or purchase (Alternative 2) the machine. (Hint: This is a "lease or buy" decision, which must be analyzed from the perspective of the machine user, as opposed to the machine owner.) If an amount is zero, enter "0". Use a minus sign to indicate a loss. Differential Analysis Lease Equipment (Alt. 1) or Buy Equipment (Alt. 2) December 3 Lease Equipment (Alternative 1) Buy Equipment (Alternative 2) Differential Effect on Income (Alternative 2) Revenues $:] $:] $:] Costs: Purchase price $:] $:] Freight and installation C] C] Repair and maintenance (4 years) C] C] Lease (4 years) C] C] C] Income (loss) $:] $ Determine whether Sloan should lease (Alternative 1) or buy (Alternative 2) the equipment. v Lease the equipment Buy the equipment