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Your company is considering the purchase of a fleet of cars for $195,000. It can borrow...

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Finance

Your company is considering the purchase of a fleet of cars for$195,000. It can borrow at 8.5%. The cars will be used for fouryears. At the end of four years they will be worthless. You call aleasing agent and find that the cars can be leased for $55,000 peryear. The corporate tax rate is 34% and the cars belong in CCAclass 10 (a 30% class), what is the net advantage to leasing?

A) $6,594 B) $9,988 C) $10,134 D) $15,363 E) $21,802

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