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 Exhibit 13B-1 and Exhibit 13B-2 to determine the appropriate discount factor(s) using table.
A. $12,528
B. $14,808
C. $14,103
D. $11,050
Answer: A
Business
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