a\%. I) ne of the loase and of the purchase are as folown: year 3 under the lease option. Purchase The equibment costs $70,000 and can be finsenced with a 14% loan requiring ancuat end-of-year poyments of $30,151 for three years. JLB wil ispreciate the equioment under Maces costs will be bome by the firm. The firm plans to keop the equipment and use it beyond ta three-year recovery period. a. Calculate the atlentax cash outfow associated with each atematve. (Hht. Bpcouse insurance and other costs are bome by the fim under boch aitenasies, those coets can be ignoced hore.) b. Calculate the present value of each stream, using the afler tax cost of debe. c. Which altamative - lease of purchase- would you recommend? Why? a. The after-tax cash outlow associated with the lease in year 1 is $21,300. (Round to the neareat dollac.) The afer-tax cash outfow associated with the lease in year 2 is 5 (Round to the nearest dollar) The after-tax cash outflow associated with the lease in year 3 is $26,300. (Round to the nearest dollar.) The afler-tax cash ouflow associated with the purchase in year 1 is 4 (Round to the nearest dollar) directly apply double-declining balance depreciation using the half-year convention