XYZ company has one leased Nissan Urvan minibus to transport the employees from and to accommodation. Consequently, the company is evaluating the feasibility of either buying a bus or continue leasing. The below are a set of assumptions to help XYZ company future decision comparing which option is most economical by through conducting a cost-benefit analysis of the best option.

Option 1: Lease (Current Situation)

Leasing bus price: BHD 303 per month.

Price covers maintenance,insurance and registration.

Option 2: Buy

New vehicle: BHD 10,551

Price covers Insurance, registration & maintenance for the first year only

Vehicle price is depreciated by 15% each year (depreciation life 5 years) Interest Rate: 6%

Insurance premium at rate of 4% Engine, gearbox etc. are all under warranty excluding the consumables

Oil & filters: BHD 50 (each 6 months or 10,000 km (whichever comes first)

Changing tires BHD 120 (each 2 years or 50,000 km (whichever comes first)

Major Maintenance cost: BHD 200 (Major Maintenance to vehicle including inspection & all above etc. expectancy 2 years)

Deliverables: Using the above given information submit in Excel a comparison of annual cost and overall cost-benefit with a recommendation at the end.