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You work for a nuclear research laboratory that is contemplating leasing a diagnostic scanner (leasing is a very common practice with expensive, high-tech equipment).
You work for a nuclear research laboratory that is contemplating leasing a diagnostic scanner (leasing is a very common practice with expensive, high-tech equipment). The scanner costs $5,000,000, and it would be depreciated straight-line to zero over four years. Because of radiation contamination, it actually will be completely valueless in four years. You can borrow at 7 percent before taxes. Your company does not anticipate paying taxes for the next several years, but the leasing company has a tax rate of 25 percent. Over what range of lease payments will the lease be profitable for both parties? (Do not round intermediate calculations and enter your answers from lowest to highest rounded to 2 decimal places, e.g., 32.16.) Answer is complete but not entirely correct. Total payment range $ 1,275,000.00 to $ 1,600,000.00
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