You work for a nuclear research laboratory that is contemplating leasing a diagnostic scanner (leasing...
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You work for a nuclear research laboratory that is contemplating leasing a diagnostic scanner (leasing is a very common practice with expensive, high-tech equipment). The scanner costs $5,600,000, and it would be depreciated straight-line to zero over four years. Because of radiation contamination, it actually will be completely valueless in four years. You can lease it for $1,640,000 per year for four years. Assume that the tax rate is 21 percent. You can borrow at 7 percent before taxes.
a) NAL=?
b)Should you lease or buy?
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