Ajax Capital Has Determined the Amount to Be Amortized on an Extruder

question 4

Multiple Choice

Ajax Capital has determined the amount to be amortized on an extruder is $540,000.If the required rate of return is 14%, what will be the total interest received over the life of the lease given that lease payments will be made at the beginning of each of the 7 years of the lease agreement? Assume a marginal tax rate of 40%.

• A)$233,269
• B)$748,786
• C)$811,080
• D)$110,467

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Definitions:

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