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For Lisa, one of the most exciting aspects of landing a full-time job was being able to buy a different car! Even though she will be working in an urban area, she will need a reliable vehicle to travel to client locations outside the city. Lisa is trying to decide if she should buy a new vehicle or a slightly used vehicle, or lease a new(er) vehicle. She has had her eye on a dazzling blue SUV; it stares at her every time she drives by the lot. But she's not sure if she can justify its cost. Here are the costs and benefits she has gathered for each of these options: Monthly payment Time frame Warranty Full coverage insurance Operating cost Expected mileage per year Safety features $490 Buy New 6 years Excellent for 100,000 miles $190 per month $0.20 per mile 13,200 Maximum $380 4 years Excellent for next 40,000 miles only $160 per month $0.20 per mile 13,200 Buy Used Moderate Lease Midnight-Blue SUV $300 plus $2 per mile if over 10,000 miles per year 2 years Excellent for length of lease $185 per month $0.20 per mile 13,200 Maximum

For Lisa, one of the most exciting aspects of landing a full-time job was being able to buy a different car! Even though she will be working in an urban area, she will need a reliable vehicle to travel to client locations outside the city. Lisa is trying to decide if she should buy a new vehicle or a slightly used vehicle, or lease a new(er) vehicle. She has had her eye on a dazzling blue SUV; it stares at her every time she drives by the lot. But she's not sure if she can justify its cost. Here are the costs and benefits she has gathered for each of these options: Monthly payment Time frame Warranty Full coverage insurance Operating cost Expected mileage per year Safety features $490 Buy New 6 years Excellent for 100,000 miles $190 per month $0.20 per mile 13,200 Maximum $380 4 years Excellent for next 40,000 miles only $160 per month $0.20 per mile 13,200 Buy Used Moderate Lease Midnight-Blue SUV $300 plus $2 per mile if over 10,000 miles per year 2 years Excellent for length of lease $185 per month $0.20 per mile 13,200 Maximum

FINANCIAL ACCOUNTING
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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Total average monthly cost $ Buy New 715 $ Buy Used 525 $ c.8. Lease Midnight Blue SUV 1416.67
Transcribed Image Text:Total average monthly cost $ Buy New 715 $ Buy Used 525 $ c.8. Lease Midnight Blue SUV 1416.67
For Lisa, one of the most exciting aspects of landing a full-time job was being able to buy a different car! Even though she will be working in an urban area, she will need a reliable vehicle to travel to client locations outside the city. Lisa is trying to decide if she should buy a new vehicle or a slightly used vehicle, or lease a new(er) vehicle. She has had her eye on a dazzling blue SUV; it stares at her every time she drives by the lot. But she's not sure if she can justify its cost. Here are the costs and benefits she has gathered for each of these options: Monthly payment Time frame Warranty Full coverage insurance Operating cost Expected mileage per year Safety features $490 Buy New 6 years Excellent for 100,000 miles $190 per month $0.20 per mile 13,200 Maximum $380 Buy Used 4 years Excellent for next 40,000 miles only $160 per month $0.20 per mile 13,200 Moderate Lease Midnight-Blue SUV $300 plus $2 per mile if over 10,000 miles per year 2 years Excellent for length of lease $185 per month $0.20 per mile 13,200 Maximum
Transcribed Image Text:For Lisa, one of the most exciting aspects of landing a full-time job was being able to buy a different car! Even though she will be working in an urban area, she will need a reliable vehicle to travel to client locations outside the city. Lisa is trying to decide if she should buy a new vehicle or a slightly used vehicle, or lease a new(er) vehicle. She has had her eye on a dazzling blue SUV; it stares at her every time she drives by the lot. But she's not sure if she can justify its cost. Here are the costs and benefits she has gathered for each of these options: Monthly payment Time frame Warranty Full coverage insurance Operating cost Expected mileage per year Safety features $490 Buy New 6 years Excellent for 100,000 miles $190 per month $0.20 per mile 13,200 Maximum $380 Buy Used 4 years Excellent for next 40,000 miles only $160 per month $0.20 per mile 13,200 Moderate Lease Midnight-Blue SUV $300 plus $2 per mile if over 10,000 miles per year 2 years Excellent for length of lease $185 per month $0.20 per mile 13,200 Maximum
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