4. Turner's has decided to modernize its production facility by acquiring $2.4 million in new fixed assets that will be depreciated straight-line to zero over five years. This equipment will have no salvage value but will provide $1,880,000 in annual pretax cost savings. Turner's tax rate is 21 percent and its pretax cost of debt is 8.6 percent. Thrifty Leasing has offered a 5-year lease on this equipment with annual payments due at the beginning of each year. What is the maximum lease payment that would be acceptable to Turner's?

Multiple Choice

$593,231

$570,497

$404,506

$406,318

$611,472