4. You plan to lease (Begin Mode!!!) a new care today. The dealership's finance office quotes you a deal with no money down and a $450 monthly payment (assume no taxes) for the next 36 months. Atthe end of the 36 months you plan to buy the car for $18,000. Thelisted price today for the car is $30,000 What CAP RATE (the interest rate on the lease) are they charging for this lease deal? Some notes: Think about which way your cash flows go. You willl make a $450 payment each month. You will also pay $18,000 at the end of the lease if you buy the car The I/Y you calculate for the MONTHLY payments is not the final answer! 1. 2. N I/Y PV PMT FV CAP RATE on the lease: (This is the answer to the question)
4. You plan to lease (Begin Mode!!!) a new care today. The dealership's finance office quotes you a deal with no money down and a $450 monthly payment (assume no taxes) for the next 36 months. Atthe end of the 36 months you plan to buy the car for $18,000. Thelisted price today for the car is $30,000 What CAP RATE (the interest rate on the lease) are they charging for this lease deal? Some notes: Think about which way your cash flows go. You willl make a $450 payment each month. You will also pay $18,000 at the end of the lease if you buy the car The I/Y you calculate for the MONTHLY payments is not the final answer! 1. 2. N I/Y PV PMT FV CAP RATE on the lease: (This is the answer to the question)
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter20: Accounting For Leases
Section: Chapter Questions
Problem 7RE: Use the information in RE20-6. However, assume that there is no bargain purchase option and that...
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