12) 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 $7,280,000, and it would be depreciated straight-line to zero over four years. Because of radiation contamination, it will actually be completely valueless in four years. You can lease it for $2,175,000 per year for four years. Assume that the tax rate is 35 percent. Suppose the entire $7,280,000 purchase price of the scanner is borrowed. The rate on the loan is 8 percent, and the loan will be repaid in equal annual installments. Calculate the amount of annual loan repayment. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Payment $ Complete the schedules given below and calculate the NAL. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16. Negative amounts should be indicated by a minus sign.) Amortization Beginning Total Interest Principal Ending Year Balance Payment Payment Payment Balance 1 $ $ $ $ $ 2 3 4 Cash flows Aftertax Total Year Loan Payment OCF Cash Flow 1 $ â $ = $ 2 $ â $ = $ 3 $ â $ = $ 4 $ â $ = $ NAL $
12) 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 $7,280,000, and it would be depreciated straight-line to zero over four years. Because of radiation contamination, it will actually be completely valueless in four years. You can lease it for $2,175,000 per year for four years. Assume that the tax rate is 35 percent. Suppose the entire $7,280,000 purchase price of the scanner is borrowed. The rate on the loan is 8 percent, and the loan will be repaid in equal annual installments. Calculate the amount of annual loan repayment. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Payment $ Complete the schedules given below and calculate the NAL. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16. Negative amounts should be indicated by a minus sign.) Amortization Beginning Total Interest Principal Ending Year Balance Payment Payment Payment Balance 1 $ $ $ $ $ 2 3 4 Cash flows Aftertax Total Year Loan Payment OCF Cash Flow 1 $ â $ = $ 2 $ â $ = $ 3 $ â $ = $ 4 $ â $ = $ NAL $
Related questions
| 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 $6,900,000. Because of radiation contamination, it will actually be completely valueless in four years. You can lease it for $1,960,000 per year for four years. Assume that the tax rate is 35 percent. You can borrow at 6 percent before taxes. Assume that the scanner will be depreciated as three-year property under MACRS. |
| What is the NAL of the lease? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) |
| NAL | $ |
