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Help Save Submit 2 10 Check my work sold the cars after three years of use. The company's present feet of cars is three years old and will be sold very shortly. To provide a replacement fleet, the company is considering two alternatives Purchase alternative: The company can purchase the cars, in the past, and sell the care after three years of use. Ten cars will be needed, which can be purchased at a discounted price of $25,000 each. If this alternative is accepted, the following costs will be incurred on the flestus whole: Annual cost of servicing, taxes, and licensing epairs, first year Hepairs, second year Repairs, third year $ 3,900 $ 1.000 $ 4,300 $6,500 At the end of three years, the fleet could be sold for one-half of the original purchase price Lease alternative The company can lease the cars under a three-year lease contract. The lease cost would be 558,000 per year the first payment due at the and of Year 1). As part of this lease cont. the owner would provide all servicing and repairs, license the cars and pay all the taves Riteway would be required to make a $24.500 security deposit at the beginning of the leate period, which would be refunded when the cars were returned to the car at the end of the lease contract Riteway Ad Agency's required rate of retum is 17 here to search 84 Cloudy 20 1 Dout van 2 Patent value of an entity at etin kertoaa : Li - intl COLE CAT 10 OCH CLEO SO 02 0909000 907 034000833130 0000 1761 to 1668 164 1695 16051515661547 20012572 2011 2002 2003 231 232 230 220 2210 20 2000 2001 2000 1 3307 2103103211212855222732030 2009 2010 2012 2013 20 29 201605292 312313 1221000 2001 2.920 2004 2003 200 30797 476 40 190 27381615 1599 1490 3:10 13700200151 53095200 4.068 2564 400 40 09122 1230100125012072210 5141 5002 5995 575752852947607 201103000 15000 2200 201 GS 5185850 2051304059105039492 05429029121 140 0.105 6207 5.091 905352402406 4650 4.00 IT 0302010 05703 301 192694590SS0 S12 0944127 2904 7100 675004025002553554257 25334203407390 130 92 236766622600257245229500402 02240 162 1113 2007 255500 7601 2612 537 5.75 504 5092416467545 on 10 20090694 333 30 282623786974 01 205 59545.650551020045 274970 22 04 3.077 75427120779507054155222404775 uns 4040521 650 1128 10.0507 201 2202 225000006758515273502 1201000192 1006 26013980 1505295000 550 60 756 5670435 400540421 150 2052 TO 10.5911 3.573740370255623 5250 5920 562055701 4370 65001110 254 14.03 201704 100172 1595 07525627826563354 527 2015 201401 2000 10.2010 2 7645 2010 001001 1900 000 000 1100 57 D303371580 320627 2230693065725025 1924 20 1300:50 1146.5299 153407042205 004 07351000 5102 29 20 190 204 07318567323 07027700750575560595294721 10 43751310000 101 170007372 600500 52022 21 H2 1000 2500 25 5 5.73.252 453 45 10000 1105 1019 9.307 35022904 74 04152550259545 5 0500221000015666205510292975501 15h 1650 11.53 1624427 42055 706566 599057759705140195 15345 1925 10.5197755124751 705 30 21 22 24 32 e to search (59 34' Cloudy 1 3 LOT 15 Part of the 17 8 9 10 1 SL 15 10 19 2 095200035 0.920 0917 200909010393077 00 0.862015503470340020002000000000 02209070890007306701208200012 0.79707030700075607430731 ona 0.00 0.00 0.006200650 00964 0406 0.7010 07510737 0712000675065 064106240609056305790564 0.5510701050 0823 072 0763 075 07000083 0.6500636 000 0.2 0.2 0.552 0.534 0.9160499048200705002310410 207470713 0600050002105030567 053 0519049704760456 047 04190.40302080370095501000 07900246 0705 00000000590056405350507 0480 085602320400390 03700352 0335 0.19 0301 02020202 0.000669623 053 0547 050 0482 042 0425 0.400 0.75 0.354 03330:3140295 0.279020302400250272020 07 0.6770622 052 050 0.502 0.007 0.01 0.04 0376 0351 0.327 03050.285 02060342 021 0202040 070006450592 05410.500 0.400.4240391 0361 0201 03080284 0.200 0.243 022502090194 010 067 0.155 010 0.57000140558 0.500 0.4630422 036 03520322 0295 02700207 0227 0208 0991 01750120907 00 065005550527 0.429 030803500370280 0201 0237 02150195 0179016208050030112 3 000 000 00205570497040107970356 03190295 0257 0231 0208 0987 0108 0152017 0124 010 0102009200300000 000105300460 0.45 0.368 026 0290 0.250 0.229 0204 42 0.630145 0001 01040093 0.04 0.075000000 057705050.442038000299 0203 0232 0205 0.18 0100 0125 0.111 00990093 002 0.00900005500400014 0.0170362 02150275 02090209 0183 0.16001000101010 0005 0004 0.07 0.065 005700510000000035 00340394 07590292 0252 02180188 016 011 0.1210107 0093 0.001 00 0062 0054 0047 000 00800320028 059301060371 0.27002010100 0170 0.145 0.125 0.000000000000000000005200450000000000000 044160350 0.296 01250022000 0130 011 0.00500010000005000510000380032002100200001 005 0.396 0231 02770.222 0194 014 013801 0090 0.003 007000600051 000 003700300210000000000 0.65601700258 02150178 OS 0.134 0.0040070073 0.061005100430037003100200032001000000 0039 03596294 0242 01990166 0135 DIE 0097 007 0064 005 0044 007 008100250022 0.000150000011 Go 27014702702200184 01500123 10000 0.083 000 0056 0.04000380032 0.0200022 0.01 0.0150000 000000 0.0000220220211 00 0108 0112000100100600.0190000033 0022 0.0220000150012 0.010 000 000 000 03900310 02070197 0158 0102000200660051 000 0035 0.023002300990015000 00000000000000 0.17525020040146 0092 0074 005 00470030030 0.034 0020001500001000000000000000004 03010201022001720185 0106 000 0005 0,053 0002 003100200021 02000000000000000000010 0307 0268 0707 0.105 0098 0.076 0000000000290022 0.01 0000 0000 000 000 0000 0004 0000002 0333 0.235039001500715 0000000000500002 0.003 0.025 0.00030100000000000000000000000000 0305 011 010 GON 00000480070029 0022000 001 00000000000000000000000002 2013100000075 00510030002000200000000000000000000000000000001 0200012000000016900022 0.0156 000 000 0005 0000 0000 0002 0.0000000000000000000000000000 10 20 20 NO 2 00 Je OF Co search o EP 3 34F Cloudy 65 Required 1 Required 2 Required 3 What is the net present value of the cash flows associated with the purchase alternative? (Enter negative amount minus sign. Round your final answer to the nearest whole dollar amount.) Net present value Rech Required 2 > Prev 2 of 6 Next > arch O F 59 Help Save Submit 2 10 Check my work sold the cars after three years of use. The company's present feet of cars is three years old and will be sold very shortly. To provide a replacement fleet, the company is considering two alternatives Purchase alternative: The company can purchase the cars, in the past, and sell the care after three years of use. Ten cars will be needed, which can be purchased at a discounted price of $25,000 each. If this alternative is accepted, the following costs will be incurred on the flestus whole: Annual cost of servicing, taxes, and licensing epairs, first year Hepairs, second year Repairs, third year $ 3,900 $ 1.000 $ 4,300 $6,500 At the end of three years, the fleet could be sold for one-half of the original purchase price Lease alternative The company can lease the cars under a three-year lease contract. The lease cost would be 558,000 per year the first payment due at the and of Year 1). As part of this lease cont. the owner would provide all servicing and repairs, license the cars and pay all the taves Riteway would be required to make a $24.500 security deposit at the beginning of the leate period, which would be refunded when the cars were returned to the car at the end of the lease contract Riteway Ad Agency's required rate of retum is 17 here to search 84 Cloudy 20 1 Dout van 2 Patent value of an entity at etin kertoaa : Li - intl COLE CAT 10 OCH CLEO SO 02 0909000 907 034000833130 0000 1761 to 1668 164 1695 16051515661547 20012572 2011 2002 2003 231 232 230 220 2210 20 2000 2001 2000 1 3307 2103103211212855222732030 2009 2010 2012 2013 20 29 201605292 312313 1221000 2001 2.920 2004 2003 200 30797 476 40 190 27381615 1599 1490 3:10 13700200151 53095200 4.068 2564 400 40 09122 1230100125012072210 5141 5002 5995 575752852947607 201103000 15000 2200 201 GS 5185850 2051304059105039492 05429029121 140 0.105 6207 5.091 905352402406 4650 4.00 IT 0302010 05703 301 192694590SS0 S12 0944127 2904 7100 675004025002553554257 25334203407390 130 92 236766622600257245229500402 02240 162 1113 2007 255500 7601 2612 537 5.75 504 5092416467545 on 10 20090694 333 30 282623786974 01 205 59545.650551020045 274970 22 04 3.077 75427120779507054155222404775 uns 4040521 650 1128 10.0507 201 2202 225000006758515273502 1201000192 1006 26013980 1505295000 550 60 756 5670435 400540421 150 2052 TO 10.5911 3.573740370255623 5250 5920 562055701 4370 65001110 254 14.03 201704 100172 1595 07525627826563354 527 2015 201401 2000 10.2010 2 7645 2010 001001 1900 000 000 1100 57 D303371580 320627 2230693065725025 1924 20 1300:50 1146.5299 153407042205 004 07351000 5102 29 20 190 204 07318567323 07027700750575560595294721 10 43751310000 101 170007372 600500 52022 21 H2 1000 2500 25 5 5.73.252 453 45 10000 1105 1019 9.307 35022904 74 04152550259545 5 0500221000015666205510292975501 15h 1650 11.53 1624427 42055 706566 599057759705140195 15345 1925 10.5197755124751 705 30 21 22 24 32 e to search (59 34' Cloudy 1 3 LOT 15 Part of the 17 8 9 10 1 SL 15 10 19 2 095200035 0.920 0917 200909010393077 00 0.862015503470340020002000000000 02209070890007306701208200012 0.79707030700075607430731 ona 0.00 0.00 0.006200650 00964 0406 0.7010 07510737 0712000675065 064106240609056305790564 0.5510701050 0823 072 0763 075 07000083 0.6500636 000 0.2 0.2 0.552 0.534 0.9160499048200705002310410 207470713 0600050002105030567 053 0519049704760456 047 04190.40302080370095501000 07900246 0705 00000000590056405350507 0480 085602320400390 03700352 0335 0.19 0301 02020202 0.000669623 053 0547 050 0482 042 0425 0.400 0.75 0.354 03330:3140295 0.279020302400250272020 07 0.6770622 052 050 0.502 0.007 0.01 0.04 0376 0351 0.327 03050.285 02060342 021 0202040 070006450592 05410.500 0.400.4240391 0361 0201 03080284 0.200 0.243 022502090194 010 067 0.155 010 0.57000140558 0.500 0.4630422 036 03520322 0295 02700207 0227 0208 0991 01750120907 00 065005550527 0.429 030803500370280 0201 0237 02150195 0179016208050030112 3 000 000 00205570497040107970356 03190295 0257 0231 0208 0987 0108 0152017 0124 010 0102009200300000 000105300460 0.45 0.368 026 0290 0.250 0.229 0204 42 0.630145 0001 01040093 0.04 0.075000000 057705050.442038000299 0203 0232 0205 0.18 0100 0125 0.111 00990093 002 0.00900005500400014 0.0170362 02150275 02090209 0183 0.16001000101010 0005 0004 0.07 0.065 005700510000000035 00340394 07590292 0252 02180188 016 011 0.1210107 0093 0.001 00 0062 0054 0047 000 00800320028 059301060371 0.27002010100 0170 0.145 0.125 0.000000000000000000005200450000000000000 044160350 0.296 01250022000 0130 011 0.00500010000005000510000380032002100200001 005 0.396 0231 02770.222 0194 014 013801 0090 0.003 007000600051 000 003700300210000000000 0.65601700258 02150178 OS 0.134 0.0040070073 0.061005100430037003100200032001000000 0039 03596294 0242 01990166 0135 DIE 0097 007 0064 005 0044 007 008100250022 0.000150000011 Go 27014702702200184 01500123 10000 0.083 000 0056 0.04000380032 0.0200022 0.01 0.0150000 000000 0.0000220220211 00 0108 0112000100100600.0190000033 0022 0.0220000150012 0.010 000 000 000 03900310 02070197 0158 0102000200660051 000 0035 0.023002300990015000 00000000000000 0.17525020040146 0092 0074 005 00470030030 0.034 0020001500001000000000000000004 03010201022001720185 0106 000 0005 0,053 0002 003100200021 02000000000000000000010 0307 0268 0707 0.105 0098 0.076 0000000000290022 0.01 0000 0000 000 000 0000 0004 0000002 0333 0.235039001500715 0000000000500002 0.003 0.025 0.00030100000000000000000000000000 0305 011 010 GON 00000480070029 0022000 001 00000000000000000000000002 2013100000075 00510030002000200000000000000000000000000000001 0200012000000016900022 0.0156 000 000 0005 0000 0000 0002 0.0000000000000000000000000000 10 20 20 NO 2 00 Je OF Co search o EP 3 34F Cloudy 65 Required 1 Required 2 Required 3 What is the net present value of the cash flows associated with the purchase alternative? (Enter negative amount minus sign. Round your final answer to the nearest whole dollar amount.) Net present value Rech Required 2 > Prev 2 of 6 Next > arch O F 59

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