FIN 516 Week 5 Homework Problem
Problem 257 on Purchase Versus Lease Based on Chapter 25 Riverton Mining plans to purchase or lease 220,000 worth of excavation equipment. If purchased, the equipment will be depreciated on a straightline basis over 5 years, after which it will be worthless. If leased, the annual lease payments will be 55,000 per year for 5 years.