calculate whether it would be nore economical to kease or buy a car: cost of the...

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calculate whether it would be nore economical to kease or buya car: cost of the car ($35,000), term of the lease (5 years@$7,000), tax shield(40%), CCA allowance (5 year straight line),residual value (nil), finance costs (8%).

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Option 1 Buy a car Tax savings on depreciation Year 1 2 3 4 5 Depreciation 7000 7000 7000 7000 7000 Tax shield 40 2800 2800 2800 2800 2800 PV factor 8 0926 0857 0794 0735 See Answer

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calculate whether it would be nore economical to kease or buy a car: cost of the...

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Question

Accounting

calculate whether it would be nore economical to kease or buya car: cost of the car ($35,000), term of the lease (5 years@$7,000), tax shield(40%), CCA allowance (5 year straight line),residual value (nil), finance costs (8%).

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