Your Company Is Considering the Purchase of a Fleet of Cars

question 239

Multiple Choice

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 four years. At the end of four years they will be worthless. The corporate tax rate is 34%. The cars belong in CCA class 10 (a 30% class) . What is the break-even lease payment?

• A) $35,675
• B) $47,328
• C) $55,000
• D) $56,128
• E) $57,705

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Definitions:

Fractions

Portions of a whole number, symbolized by two integers separated by a slash, with one part representing a portion of the whole.

Whole Numbers

Numbers without fractions or decimals; positive integers including zero.

Lowest Terms

The most reduced form of a fraction, where the numerator and denominator are at their smallest whole number ratio.

Fractions

Represents parts of a whole or a collection, expressed with different numbers on the top (numerator) and bottom (denominator) of a slash or line.