Question

Given the lease terms below, calculate the total depreciation.

Lease Term: 36 Months
MSRP: $27,500.00
Purchase Price: $17,500
Down payment: $3400
Monthly Payment: $425
Security Deposit: $375
Acquisition Fee: $500.00

a) $183.33
b) $375.15
c) $202.45
d) $427.50

Answer 1

To calculate the total depreciation, subtract the purchase price from the MSRP and then subtract the sum of the down payment, security deposit, and acquisition fee. In this case, the total depreciation is $5,825.

Step-by-step explanation:

To calculate the total depreciation, we need to consider the lease term, MSRP, purchase price, down payment, monthly payment, security deposit, and acquisition fee.

The total depreciation can be calculated by subtracting the purchase price from the MSRP and then subtracting the sum of the down payment, security deposit, and acquisition fee from that value.

In this case, the total depreciation would be $27,500 - $17,500 - ($3,400 + $375 + $500) = $5,825. Therefore, the correct answer is $5,825.