7a. A 48-month lease plan on a luxury car that costs $45,700 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?

7a. A 48-month lease plan on a luxury car that costs $45,700 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?

PFIN (with PFIN Online, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)

6th Edition

ISBN:9781337117005

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter5: Making Automobile And Housing Decisions

Section: Chapter Questions

Problem 2FPE: Lease ersus purchase car decision. use wor sheet 5.1. Everett Adams is trying to decide whether to...

See similar textbooks

Similar questions

Use the following data: Purchase Costs Down payment: $4,800. Loan payment: $340 for 48 months Estimated value at end of loan: $5,100 Opportunity cost interest rate: 2 percent per year Calculate the costs of buying versus leasing a motor vehicle. Cost of buying Cost of leasing Leasing Costs Security deposit: $1,600 Lease payment: $340 for 48 months End-of-Lease charges: $765
Based on the following, calculate the costs of buying versus leasing a motor vehicle. Purchase Costs Leasing Costs Down payment: $1,500 Security deposit: $500 Loan payment: $450 for 48 months Lease payment: $450 for 36 months Estimated value at end of loan: $4,000 End-of-lease charges: $600 Opportunity cost interest rate: 4 percent
Use the following data: Purchase Costs Leasing Costs Down payment: $4,800 Security deposit: $1,600 Loan payment: $1,440 for 48 months Lease payment: $1,440 for 48 months Estimated value at end of loan: $5,100 End-of-lease charges: $765 Opportunity cost interest rate: 2 percent Calculate the costs of buying versus leasing a motor vehicle. Cost of buying $ Cost of leasing $
Use the following data: Down payment (to finance vehicle) Monthly loan payment Length of loan Value of vehicle at end of loan . What is the total cost for buying and for leasing a motor vehicle with a cash price of $38,500? Buying Leasing Total Cost $6,600 $ $ 920 48 months. 12,400 Down payment for lease. Monthly lease payment. Length of lease End-of-lease charges $ 2,500 $ 700 48 months $1,250
please help with this Q
Compare the cost of the following leasing agreement with the finance charge on a loan for the same time period: The value of the car is $15,000 at the beginning of the lease period, and its projected residual value at the end of three years is $4,000. The lease requires a $500 down payment. Monthly payment $315 Acquisition fee $300 Disposition charge $150 Other things being equal, one would want to finance this car rather than take this lease if the finance cost were equal to or less than?
44. Subject :- Accounting is it correct? To calculate the total cost of leasing a hybrid vehicle for 5 years, we need to consider the monthly lease payment and the down payment. Here's the breakdown: Lease Payment: Monthly Lease Payment: $80 Lease Term: 5 years (60 months) Total Lease Payments: $80/month * 60 months = $4,800 Down Payment: Down Payment: $3,000 Total Cost of Lease: Total Cost of Lease = Total Lease Payments + Down Payment Total Cost of Lease = $4,800 + $3,000
Hw.190.
Suppose you decide to obtain a 4-year lease for a car and negotiate a selling price of$28,990, including license fees. The trade-in value of your old car is $3850. If you makea down payment of $2400, the money factor is 0.0027, and the residual value is$15,000, find each of the following.a. The net capitalized costb. The average monthly finance chargec. The average monthly depreciationd. The monthly lease payment
Use the following data: Down payment (to finance vehicle) Monthly loan payment Length of loan. Value of vehicle at end of loan Buying Leasing $ 5,000 $ 700 48 months Buying O Leasing $ 9,200 Down payment for lease Monthly lease payment Length of lease End-of-lease charges b. Based on your answers in part a, would you recommend buying or leasing? $1,700 $ 540 $ a. What is the total cash outflow for buying and for leasing a motor vehicle with a cash price of $29,500? Total Cash Outflow 48 months 850
A luxury car can be leased for $679 per month for 36 months. Terms are first month’s lease payment, a $625 refundable security deposit, a consumer down payment of $3500, and an acquisition fee of $725 due at lease signing. Tax, license, title fees, and insurance extra. Option to purchase at lease end for $37,775 plus a fee of $350.Mileage charge of $0.20 per mile over 30,000 miles. Determine the interest rate (nominal and effective) for the lease. The MSRP is $64,025. You could buy the car for $58,000, if you arranged other financing.
Hansaben