Keating Co. is considering disposing of equipment with a cost of $70,000 and accumulated depreciation...
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Keating Co. is considering disposing of equipment with a cost of $70,000 and accumulated depreciation of $49,000. Keating Co. can sell the equipment through a broker for $26,000 less 10% commission. Alternatively, Gunner Co. has offered to lease the equipment for five years for a total of $50,000. Keating will incur repair, insurance, and property tax expenses estimated at $10,000 over the five-year period. At lease-end, the equipment is expected to have no residual value. The net differential income from the lease alternative is
$16,600
$11,620
$24,900
$19,920
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