Latting Corporation Has Entered into a 7 Year Lease for a Building

Multiple Choice

Latting Corporation has entered into a 7 year lease for a building it will use as a warehouse. The annual payment under the lease will be $4,781. 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 6%, the present value of the lease payments is closest to:

A) $31,573
B) $22,257
C) $33,467
D) $26,688