Kitchen Remodelers needs to replace their pneumatic tools. The cost is $78,000 and the tools will be worthless after 4 years. The tools belong in a 20 percent CCA class and can be leased for
$21,300 a year. The ﬁrm can borrow money at 10 percent. The ﬁrm does not expect to pay any
Taxes for the next 5 years. What is the net advantage to leasing?

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The Answer of Kitchen Remodelers needs to replace their pneumatic tools. The cost is $78,000 and the tools will be worthless after 4 years. The tools belong in a 20 percent CCA class and can be leased for
$21,300 a year. The ﬁrm can borrow money at 10 percent. The ﬁrm does not expect to pay any
Taxes for the next 5 years. What is the net advantage to leasing?

Kitchen Remodelers Needs to Replace Their Pneumatic Tools