5.Valuing A Financial Lease o Determining lease payment:Three-step process Step 1:Compute the lessor's amount to be amortized Initial outlay Less:PV of after-tax salvage Less:PV of depreciation tax shelter Equals:Amount to be amortized Step 2:Compute after-tax lease income required Amount to be amortized PV of after-tax lease payment Step 3:Compute before-tax lease payment Lease After-tax lease income required Payment 1 lessor's marginal tax rate 剥外经价贫多方房 YO年NEB证事00005.Valuing A Financial Lease z Determining lease payment:Three-step process – Step 1: Compute the lessor’s amount to be amortized Initial outlay Less: PV of after-tax salvage Less: PV of depreciation tax shelter Equals: Amount to be amortized – Step 2: Compute after-tax lease income required Amount to be amortized = PV of after-tax lease payment – Step 3: Compute before-tax lease payment Lease Payment = After-tax lease income required 1 - lessor’s marginal tax rate