Traynor Industries is considering either leasing or buying some new equipment. The lessor will charge $9,950 a year as the annual lease payment. The purchase price is $27,900. The equipment
Belongs in a 30 percent CCA class and has a 3-year life after which time it will be worthless. Traynor
Borrows money at 7.25 percent, and has suﬃcient tax loss carryovers to offset any potential taxable
Income the ﬁrm might have over the next ﬁve years. What is the net advantage to leasing?

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The Answer of Traynor Industries is considering either leasing or buying some new equipment. The lessor will charge $9,950 a year as the annual lease payment. The purchase price is $27,900. The equipment
Belongs in a 30 percent CCA class and has a 3-year life after which time it will be worthless. Traynor
Borrows money at 7.25 percent, and has suﬃcient tax loss carryovers to offset any potential taxable
Income the ﬁrm might have over the next ﬁve years. What is the net advantage to leasing?

Traynor Industries Is Considering Either Leasing or Buying Some New