Your client, Keith Stellar Leasing Company, is preparing a contract to lease a m

Question

Your client, Keith Stellar Leasing Company, is preparing a contract to lease a machine to Souvenirs Corporation for a period of 27 years. Stellar has an investment cost of $427,100 in the machine which has a useful life of 27 years and no salvage value at the end of that time. Your client is interested in earning an 9% return on its investment and has agreed to accept 27 equal rental payments at the end of each of the next 27 years Click here to view fact You are requested to provide Stellar with the amount of each of the 27 rental payments that will yield an 996 return on investment. (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to o decimal places, e.g. 458,581.) Amount of each rental payments

Explanation / Answer

Amount of each rental payments = 427100/10.02658= $42597

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