4. The management of The Alexandrov Company decided to acquire the use of a machine to be used in its manufacturing process. The machine is manufactured only by Chang, Incorporated. The machine would have a useful life of ten years and would then be sold for $10,000 at the end of its useful life. Chang's management has presented Alexandrov with the following acquisition options: Lease: The machine could be leased for an eight-year period for an annual lease payment of $25,000, with the first payment due on the date that the agreement is signed. Related annual executory costs (maintenance and insurance expenses for the machine), which are expected to be about $5,000 per year, would be paid by Alexandrov. Purchase: The machine could be purchased for $130,000 in cash. The related maintenance and insurance costs would also become the additional responsibility of Alexandrov. Assume that (1) Alexandrov and Chang will agree on a transaction on November 30, 2020; and (2) the current interest rate for Alexandrov's lease arrangements is 12%, but the rate applicable to annual maintenance and insurance expenses is only 8%. Prepare a schedule showing the alternatives available to The Alexandrov Company for the acquisition of the equipment. Present Value of $1 M 1 6.0% 7.0% 0.94340 0.93458 0.19000 0.87344 0.83962 081630 0.79209 0.76290 0.76726 071299 0.70096, 0.56634 0.66506 0.62275 0.42741 0.58201 0.39190 0.54393 0.55839 Q.50835 0.0% 0.0% 10.0% 11.0% 12.0% 0.92593 0.01743 0.90909 0.90090 0.29286 0.85734 0.84168 0.82545 0.81162 0.79719 0.79383 0.77218 75131 0.73119 071178 0.73503 07056 063301 0.65873 0.63552 0.68058 0.54993 0.62092 0.59345 0.5674 0.63017 0.59627 0.56447 0.53454 0.50663 0.58349 0.54703 0.51316 0.48166 045235 0.54027 0.50187 0.46651 0.43393 0.40388 0.50025 0.46043 042410 0.39092 0.36061 0.46319 0.42241 0.38554 0.35218 0.3297 0.83333 0.69444 0.57870 0.48225 0.40188 8 0.33490 0.27908 0.23257 0.19381 0.16151 10 11 12 0.52679 0.47509 0.46697 0.44601 0.46884 0.41496 0.4230 0.38782 0.41727 0.36245 0.42658 0.38753 0.35049 0.31728 0.28763 0. 11 0.35553 031863 0.28584 0.25668 0.36770 0.32618 0.28966 0.25751 0.22917 0.34046 0.29925 0.26333 0.22109 0.20462 0.31524 0.27454 0.23939 0.20900 0.18270 0.13459 0.11216 0.09346 0.07789 0.06491 Future Value of $1 6.0% 7.0% 0.0% 0.0% 100% 11.0% 12.0% 20.0% 1 106000 107000 1.08000 1.09000 1.10000 1.11000 1.12000 120000 2 1.12350 1.14490 1.100 1.18810121000 1.23210 1.25440 144000 1.19102 1.22504 1.2571 1.29503 1.33100 1.36763 1.40493 1.72800 1.26243 1.31080 1.36049 1.41158 1.45410 1.51807 1.57352 2.07350 5 1.31823 1.40255 1.48933 1.53562 1.61051 1.68506176234 2.48832 6 141552 1.50073 1.58507 1.67710 1.77156 1.87041 1.97332 2.92593 7 1.50543 1.60572 171382 1.2004 1.948722.07616 2.0B 3.58313 # 159305 171819 0931.99256 2.14359 2.30454 2.47505 9 1698 1.83846 1.99900 2.17189 235795255004 277308 5.15778 10 1. 1.95715 2.15892 2.367362 .59374 2.8.1942 1105856.10174 11 30 219485233164 2.58043 2.65312 3.15176 1.47855 7430 12 2.01220 225219 2.51017 2.81246 3.13343 340345 3.8958.8.91610 132.13293 2.409952 .71962 3.06530 3.45227583328 4.363491069932 142.26090257853 2.93719 3.34173 3.7975031044 4.52211 123916 15 2.99656 275903 3.17217 .64348 4.17725 4.73459 5.47357 15.40702 Present Value of an Ordinary Annuity M 1 2 6.0% 0.94340 1.83339 4 3.46511 5 421236 6 491732 7 5.58238 8 6.20979 6.80169 10 738009 7.0% 0.0% 0.0% 0.0% 11.0% 12.0% 20.0% 0.93458 0.92593 0.91743 0.90909 0.90090 0.89286 0.83333 1.80802 1.78326 1.75911 1.73554 1.71252 1.6700S 1.52778 253129 248685 244371 240183 2.10648 3.38721 3.31213 3.23972 3.10987 3.10.245 3.03735 258873 4.10020 2.99271 3.84965 3.79079 3.89590 3.60478 2.99061 4.76654 4.62288 4.48592 4.35526 4.230511147 3.32551 5.38929 5.206275.03295 4.36842 4.71220 4.56376 3.60459 5.97130 5.74664 5.534825_33493 5.14612 4.96764 3.83716 6.51523 4.24689 5.99525 5.75902 5.53705 5.32825 4.03097 7.02358 6.71008 6.41766 6.14457 5.88923 565022 4.1920 11 7.58687 749867 7.13896 12 8.38384 7.94269 7.53608 13 3.85268 .35765 7.90378 14 9.29498. 8.76547 8.24424 15 9.71225 9.10791 8.55948 6.80519 6.49506 6.20652 5.93770 432705 7.16073 6.81369 6.49236 6.19437 4.43922 7.48690 7.10236 6.74987 6A2355 4.53268 7.78615 7.36669 6.98187 6.62817 4.61057 8.06069 7.60608 7.19087 6.81086 4.57547 Future Value of an Ordinary Annuity M 6.0% 7.0% 0.0% 9.0% 10.0% 11.0% 12.0% 20.09% 1.0000 10000 1.000 1.000 1.000 1.000 1.0000 1.0000 20600 2.0700 2.0800 20900 - 21000 2.1100 21200 2.2000 2.1836 3.2147 3.2464 3.2781 3.3100 3.3421 33744 3.5400 43746 4.4399 4.5061 45731 4.6410 4.7097 4.7793 53680 5.6371 5.7507 5.86665.9847 6.1051 6.2278 3528 7.4416 6.9753 7.1533 7.3359 7.5233 7.7156 7.9129 8.1152 3.3938 8.6540 8.9228 9.2004 9.4872 9.7833 100290 12.9159 9.8975102595 10.6366 11.0265 11.4359 11.8596 12.2997 16,4971 11.4913 11.9750 12.4876 13.0210 13.5795 14.1640 14.7757 20.7959 to 12.1800 13.5764 14.4866 15.1929 15.9374 16.7220 17.5687 25 0587 1 14.9715157836 16 5455 17.5603 15.5312 19.5614 20654632.1504 12 16.8497 17.855 18.9771 20140721.3343 22.7132 24.1331 39.5305 3 12.8221 20.1406 214953 22.9534 24.5227 26 2116 28.0291 8.4956 14 21.0151 22.5505242149 240192 22.750 30.0949 322926 59.1959 9.9299