A business is renting a machine for $50,000 per year, which includes all maintenance expenses. The business has 2 options:

[Option #1] Purchase that machine for $150,000. (The company would have $20,000 per year in ongoing maintenance expense).

[Option #2] Purchase a better machine for $250,000. (The company would have $15,000 per year in ongoing maintenance expense and lower annual packaging costs by $10,000. They would also have an upfront training expense of $35,000)

-Maintenance and packaging costs are paid at the end of each year, but the rent of the machine is paid at the beginning of the year.

-The appropriate discount rate is 7.75% per year.

-The machines will be depreciated via the straight-line to zero method over seven years and that they will be used for 10 years with no salvage value at the end of use.

-The marginal corporate tax rate is 22%.

Which option should the company take ? Please show work on an Excel sheet. Thank you.