Question

Suddeth Corporation has entered into a 6 year lease for a building it will use as a warehouse. The annual payment under the lease will be $2,468. The first payment will be at the end of the current year and all subsequent payments will be made at year-ends. If the discount rate is 5%, the present value of the lease payments is closest to (Ignore income taxes.):
See separate handout to determine the appropriate discount factor(s) using table.

A) $12,528

B) $14,103

C) $14,808

D) $11,050

Answer 1

The answer is B because if you times 2468 by 6 and you take away the 5% of discount you get ur answer