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Toccoa Company owns equipment with a cost of $550,000 and accumulated deprecistion of $360,000 that can be sold for 5300,000, less a 3$4 sales commission.
Toccoa Company owns equipment with a cost of $550,000 and accumulated deprecistion of $360,000 that can be sold for 5300,000, less a 3$4 sales commission. Aiternatively, Foccou Company can lease the equipment for four years for a total of $350,000, at the end of which there is no residual value. In addition, the repair, insurance, and property tax expense that would be incurred by Toccoa Compony on the equipment would total 945,000 over the four-year lease. This information has been collected in the Microseft Excel Online file. Open the spresdsheet, perform the requlred analysis, and input your answers in the questions beiow. Dpen spreadsheet Prepare a diferential analyais on October 29 as to whether Teccoa Company should lease (Alternative 1) or seil (Alternative 2) the equlament Use a minus sign to indicate costs or negative differental effect on income. Differential Analysis Lease Equipment (ASt, 1) or Sell Equipment (Alt. 2) Should Toceos Company lease (ARernative 1) or sell (Alternative 2) the equipment
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