7a. A 48-month lease plan on a luxury car that costs $46,700 consists of a $2.875 down payment, monthly payments of $594.80, and a residual value of$28,400. A purchase plan for the car requires a down payment of $3,250 and a 4-year loan with monthly payments of $1,082.a. What is the total cost of leasing?b. What is the total cost of purchasing?c. Which plan gives the lowest total cost?d. What is the difference in the plans over four years?✪EDBO

Lease is defined a contractual agreement incorporated between two business entities where one entity…

Answered: 7a. A 48-month lease plan on a luxury…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A car dealer wants to offer you a 60 month lease on a $28,300 car. You can afford a $ 500 monthly payment and the dealer wants to earn a 9.4% APR. There is no down payment on the lease and monthly payments are due at the end of each month. What is the lowest estimated residual value for the car in order that the dealer earn's the their required annual percentage rate (APR). Round your final answers to the nearest dollar. A
Ab. 143.
For the Questions 3-5 assume you want to finance (borrow) $12,000 for your next car and your interest rate will be 6%. 3. What will be your monthly payment and the total amount paid over the life of the loan if you finance for 48 months? Provide the car payment and the TVM inputs you used to calculate the payment. Рayment Total of all payments PV FV RATE/INTEREST PERIODS/N (See next page for Questions 4 and 5)
Not sure what the table factor would be
Using the attached exhibit and the information below, what is the net cost of purchasing this vehicle?To answer the question, use the following assumptions:● The price of the car is $20,000.● The down payment required is $2,000● The security deposit required is $500● The sales tax rate is 10.25%%. Round to the nearest cent. DO NOT INCLUDE COMMAS OR $.● GAP insurance on the lease is $300�� Interest lost or foregone is computed using a 4% after tax rate of return (use in Step 4)● The interest rate on the lease and loan is 9% (use in Step 6).● The lease and loan terms are both 36 months.● Your resale/trade-in value for your vehicle is $6,000● Disposition fee: $250● Lease Payment: $325/ month● Purchase Payment: $360/month
You need a car and decide to lease for 36 months. The original price is $20,000 and the trade value in 36 months, assuming you don't exceed the mileage allowance, is $5,000 (treat this as a future value). No down payment is required. If the interest rate is 9% APR compounded monthly, what is the lease payment? I need it witha solutuion $503.38 $5066.37 $5100.15 $510.67
Two plans are available for a company to obtain automobiles for its salesmen. How many miles must the cars be driven each year for the two plans to have the same costs? Use an interest rate of 10%. Plan A: Lease the cars and pay PO.52 per mile. Plan B: Purchase the cars for P9.238 and economic life of three years after which it can be sold for P2,021, Gas and oil cost PO.07 per mile. Insurance is P500 per year.
A house is to be purchased by financing $ 341,998 with a mortgage. A conventional 30-year loan is used at 4%. What will be the principal portion on the first monthly payment? plz show work
Solve #4 and #5
You want to purchase an automobile for $22,800. The dealer offers you two options. Option 1 is 0% financing for 48 months. Option 2 offers 2.9% financing for 72 months. A) Compute the monthly payments for each option. Show work to justify your answer. N 1% PV PMT FV P/Y C/Y Option 1: Monthly Payment is: Option 2: Monthly Payment is: N 1% PV PMT FV P/Y C/Y B) Compute the total cost for each option. Show work to justify your answer.
Assume the car can be purchased for 0% down for 60 months (in lieu of rebate). A car with a sticker price of $42,100 with factory and dealer rebates of $5,100. Hint: See Section 11.2, Example 5. (a) Find the monthly payment if financed for 60 months at 0% APR. (Round your answer to the nearest cent.)$ (b) Find the monthly payment if financed at 2.5% add-on interest for 60 months. (Round your answer to the nearest cent.)$ (c) Use the APR approximation formula to find the APR for part (b). (Round your answer to one decimal place.) %(d) State whether the 0% APR or the 2.5% add-on rate should be preferred. 0% APR2.5% add-on rate

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