Project #27998 - Buy Vs Lease Powerpoint

This project has to do with a decision support system to assist On The Vine Grapes in making a decision to lease or buy new delivery trucks. Detailed information can be found in CASE 12 on pages 298-299 of your text book.

You are to make a PowerPoint presentation to the class that contains the following:

1. Detailed summary sheet of the lease / buy option for On the Vine Grapes.

2. A recommendation to On The Vine Grapes to buy or lease the new trucks.


**A leading supplier of grapes to do the wine-producing industry in California, On the Vine Grapes, wants to expand its deliver services and expand its reach to market by increasing its current fleet of trucks. Some of the older vehicles were acquired through closed-end leases with required down payments, mliease restrictions, and hefty early termination penalties. Other vehicles were purchased using traditional purchase-to-own loans, which often resulted in high depreciation costs and large maintenance fees. All vehicles were acquried one at a time through local dealers.

On the Vine grapes has asked you to assist in developing a lease/buy cost analysis worksheet in order to make the most cost-effective decisions. Currently the director of operations, Bill Smith, has identified a 2005 Ford F-550 4x2 SD Super Cab 161.8 in WB DRW HD XLT as the truck of choice for the business. This vehicle has retail price of #34,997. or lease price of $600/month through Ford Motor Credit Company.


Here are some basic fees:

1. Lease Costs::

Refundable security deposit : $500

First month's payment at inception : $500

Other initial Costs: $125

Monthly lease payment for remaining term ; $600

Last month payment in advance: No

Allowable annual mileage: 15,000

Estimated annual miles to be driven: 20,000

Per mile charge for excess miles:  0.10

2. Purchase costs

Retail price including sales taxes, title : $34,997

Down payment: $4,000

Loan Interest rate: 8.75%

WIll interest be deductbile business or home equity interest?  Yes

Is the gross loaded weight of the vehicle over 6,000lbs? Yes

3. Common Costs and Assumptions

Total lease/loan term : 36months

Discount percent : 8.75%

Tax bracket--Combined federal and state : 33%

Business use percentage : 100%


Some Particulars You Should Know:

1. In the file BUYORLEASE.xls is a template you can use to enter the information. There is also a sheet that has been developed to assist you with the annual deprecation for an automobile.

2. create a detailed summary sheet of the lease/buy opton for On the Vine Grapes.

2. File: BUYORLEASE.xls (Excel file)


*****Note i can provide the the 2 excel spreadsheets which are crucial to making presentation,.

About 5-6 slides should do .


Subject Business
Due By (Pacific Time) 04/22/2014 12:00 am
Report DMCA

Chat Now!

out of 1971 reviews

Chat Now!

out of 766 reviews

Chat Now!

out of 1164 reviews

Chat Now!

out of 721 reviews

Chat Now!

out of 1600 reviews

Chat Now!

out of 770 reviews

Chat Now!

out of 766 reviews

Chat Now!

out of 680 reviews
All Rights Reserved. Copyright by - Copyright Policy