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Please solve the problem correctly and show work. Thank you Subject: ACC $203$ Chapter $5$ Homework

Question $11$ of $13$

$\frac{-}{9}$

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The Flint Inc., a manufacturer of low$-$sugar, low$-$sodium, low$-$cholesterol TV dinners, would like to increase its market share in the Sunbelt. In order to do so$,$ Flint has decided to locate a new factory in the Panama City area. Flint will either buy or lease a site depending upon which is more advantageous. The site location committee has narrowed down the available sites to the following three very similar buildings that will meet their needs.

Building A: Purchase for a cash price of $$615,800,$ useful life $28$ years.

Building B: Lease for $28$ years with annual lease payments of $$71,850$ being made at the beginning of the year.

Building C: Purchase for $$655,900$ cash. This building is larger than needed; however, the excess space can be sublet for $28$ years at a net annual rental of $$6,850.$ Rental payments will be received at the end of each year. The Flint Inc. has no aversion to being a landlord.

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In which building would you recommend that The Flint Inc. locate, assuming a $11\%$ cost of funds? $($Round factor values to $5$ decimal places, e$.$g$.1\mathrm{.}25124$ and final answer to $0$ decimal places, e$.$g$.458,581.)$

Net Present Value

Building A $

Building B $

Building C $

The Flint Inc. should locate itself in

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