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Business, 27.07.2021 19:20 zoolo1

Pepper, Inc. agrees to lease equipment from the Blue Corporation for 10 years at $25,000 at the end of each year. The equipment has a fair value of $175,000 and an estimated useful life of 10 years. The lease includes a guaranteed residual value of $10,000. In addition to the lease payments, Pepper will pay $5,000 per year for a maintenance agreement. Pepper can finance this lease with its bank at a 12%. To value the lease asset, Pepper should use a discount rate of:.

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Pepper, Inc. agrees to lease equipment from the Blue Corporation for 10 years at $25,000 at the end...
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