Posted by Nick on Tuesday, April 12, 2011 at 2:23pm.
Sutton Corporation, which has a zero tax rate due to tax loss carryforwards, is considering a 5 year, $6,000,000 bank loan to finance service equipment. The loan has an interest rate of 10% and would be amortized over 5 years, with 5 endofyear payments. Sutton can also lease the equipment for 5 endofyear payments of $1,790,000 each. How much larger or smaller is the bank loan payment than the lease payment?
Note: subtract the loan payment from the lease payment

Finance  heldud, Tuesday, April 19, 2011 at 6:05pm
enter "=PMT(10%,5,6000,0)" into excel withough quatation, or using a financial calculator would be fine. The answer would be the loan payment. subtract this from the lease payment you get 207 thousand and something

Finance  D, Thursday, February 26, 2015 at 8:59pm
62,025
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