A leasing company recently acquired a new filming equipment set for $500,000. A film maker wishes to lease the equipment set for six years. The set can be depreciated on a straight-line basis over five years. Assume the set has zero salvage value at the end of five years. The leasing company faces a tax rate of 35%, and the before-tax cost of capital is 10%.

What is the minimum lease payment the leasing company would accept? (8 Marks)