Q: 1
A project requires an initial outlay of $2 million which can be financed with either a bank loan or
finance lease.
The company will be responsible for annual maintenance under either option.
The tax regime is:
• Tax depreciation allowances can be claimed on purchased assets.
• If leased using a finance lease, tax relief can be claimed on the interest element of the lease
payments and also on the accounting depreciation charge.
The trainee management accountant has begun evaluating the lease versus buy decision and has
produced the following dat
a. He is not confident that all this information is relevant to this decision.
Using only the relevant data, which of the following is correct?
Using only the relevant data, which of the following is correct?Options
Discussion
No comments yet. Be the first to comment.
Be respectful. No spam.
