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To finance some manufacturing tools it needs for the next 3 years, Waldrop Corporation is considering a leasing arrangement. The tools will be obsolete and
To finance some manufacturing tools it needs for the next years, Waldrop Corporation is considering a leasing arrangement. The
tools will be obsolete and worthless after years. The firm will depreciate the cost of the tools on a straightline basis over their
year life. It can borrow $ the purchase price, at and buy the tools, or it can make equal endofyear lease payments
of $ each and lease them. The loan obtained from the bank is a year simple interest loan, with interest paid at the end
of the year. The firm's tax rate is Annual maintenance costs associated with ownership are estimated at $ but this
cost would be borne by the lessor if it leases. What is the net advantage to leasing NAL in thousands? Suggestion: Delete zeros
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