Marlowe Company Currently Leases a Delivery Truck from Burton Enterprises

Multiple Choice

Marlowe Company currently leases a delivery truck from Burton Enterprises for a fee of $250 per month plus $0.40 per mile. Management is evaluating the desirability of switching to a modern, fuel-efficient truck, which can be leased from Goliath, Inc., for a fee of $600 per month plus $0.05 per mile. All operating costs and fuel are included in the rental fees. In general, a lease from

A) Goliath, Inc., is economically preferable to a lease from Burton Enterprises regardless of the monthly use.
B) Burton Enterprises is economically preferable below 1,000 miles per month.
C) Burton Enterprises is economically preferable to a lease from Goliath, Inc., regardless of the monthly use.
D) Burton Enterprises is economically preferable above 1,000 miles per month.