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Rom4ik [11]
3 years ago
13

Differential Analysis for a Lease or Buy Decision

Business
1 answer:
il63 [147K]3 years ago
4 0

Answer:

Lease Equipment $150,000

BUY EQUIPMENT$134,700

Differential Effects-$15,300

The company should choose BUY EQUIPMENT which is Alternative 2

Explanation:

Preparation of the differential analysis dated March 15 to determine whether Laredo Corporation should lease (Alternative 1) or purchase (Alternative 2) the equipment

Differential Analysis

Lease (Alt. 1) or Buy (Alt. 2) Equipment

March 15

Lease Equipment (Alternative 1); Buy Equipment

(Alternative 2); Differential Effects (Alternative 2)

Costs:

Purchase price $0 $120,000 $120,000

Freight and installation $0 $1,500 $1,500

Repair and maintenance (6 years) $0 $13,200.$13,200

($2,200*6=$13,200)

Lease (6 years) $150,000 $0 -$150,000

($25,000*6)

Total costs $150,000 $134,700 -$15,300

Based on the above calculation the company should choose BUY EQUIPMENT which is Alternative 2

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Ryan's Sparkling Jewels estimated its payroll for the coming year to be $84,000. Its workers' compensation
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Ryan's Sparkling Jewels estimated its payroll for the coming year to be $84,000. Its workers' compensation insurance premium rate of 0.6% is paid at the beginning of each quarter required: Calculate the estimated cost of workers' compensation insurance for the year.

Answer:

$504 per year

$126 per quarter

Explanation:

workers' compensation insurance = payroll x insurance rate.

$84,000 x 0.6%

$84,000 x 0.006 = $504 per year

$504 ÷ 4 = $126 per quarter

5 0
3 years ago
Mortar Corporation acquired 80 percent of Granite Corporation's voting common stock on January 1, 20X7. On December 31, 20X8, Mo
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Answer:

The debit adjustment to equipment would be $30,000.

Explanation:

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Debit adjustment to equipment = Purchase price of the equipment - Amount received for the equipment by Mortar from Granite = $400,000 - $370,000 = $30,000

Therefore, the debit adjustment to equipment would be $30,000.

8 0
2 years ago
Leslie hypothesizes that teenagers who read magazines develop low self-esteem because of the unrealistic expectations set by the
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David and Sandra Dess contracted with Sirva Relocation, LLC, to assist in selling their home. In their contract, the Desses agre
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Answer:

The answer is:

The Kincaids can sue David and Sandra Dess because they can be considered intended beneficiaries of the contract between them and Sirva.  

Explanation:

Intended beneficiaries are third parties in a contract that can sue the promisor for breach of contract.

In the contract, David and Sandra agreed to fully disclose all information about the property. Under the terms of the contract, they agreed that Sirva and "other prospective buyers" could rely on their disclosures.

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3 years ago
Bjorn felt that the focus groups did not give him enough quantitative information to make a decision, so he directed his manager
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