Considering leasing new robotic milling control system

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Your firm is considering leasing a new robotic milling control system. The lease lasts for 4 years. The lease calls for 5 payments of $280,000 per year with the first payment occurring at lease inception. The system would cost $900,000 to buy and would be straight-line depreciated to a zero salvage value. The firm can borrow at 10%, and the corporate tax rate is 35%. What is the NPV of the lease? Here are the available answers a) $125,789 b) $53,927 c) $(111,690) d) $(175,277) e) $(295,040)

Reference no: EM131022578

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