You are contemplating on purchasing a new motorcycle. Kangaroo Autos and Turtle Motors are both offering your preferred motorcycle brand at a price of P120,000. To entice customers, Kangaroo Autos is giving a P5,000 discount for cash payment. On the other hand, Turtle Motors is offering a monthly installment of P5,000 at the end of each month in the next 24 months. If the cost of capital is 24%, which company is offering a better deal? (Just indicate the present value of your choice in the answer field)
You are contemplating on purchasing a new motorcycle. Kangaroo Autos and Turtle Motors are both offering your preferred motorcycle brand at a price of P120,000. To entice customers, Kangaroo Autos is giving a P5,000 discount for cash payment. On the other hand, Turtle Motors is offering a monthly installment of P5,000 at the end of each month in the next 24 months. If the cost of capital is 24%, which company is offering a better deal? (Just indicate the present value of your choice in the answer field)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter19: Capital Investment
Section: Chapter Questions
Problem 9E: Each of the following scenarios is independent. All cash flows are after-tax cash flows. Required:...
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You are contemplating on purchasing a new motorcycle. Kangaroo Autos and Turtle Motors are both offering your preferred motorcycle brand at a price of P120,000. To entice customers, Kangaroo Autos is giving a P5,000 discount for cash payment. On the other hand, Turtle Motors is offering a monthly installment of P5,000 at the end of each month in the next 24 months. If the cost of capital is 24%, which company is offering a better deal? (Just indicate the present value of your choice in the answer field)
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