If a Machine Costs $50,000, and $5,000 a Year for the Lessor

question 45

Multiple Choice

If a machine costs $50,000, and $5,000 a year for the lessor to maintain and insure, what equivalent annual cost would serve as the basis of a full-service lease payment for a six-year operating lease, paid in arrears, if the lessor's cost of capital is 8%?

• A)$15,816
• B)$73,114
• C)$17,155
• D)$55,000