ABC Plant Hire has been asked by MMJ Manufacturing to quote on a 4-year lease for a stamping machine which costs $244,000.The equipment can be depreciated for tax purposes over 4 years.

The equipment has a residual value expected to be $10,000 to be received at the end of the lease period which is taxed at the corporate tax rate.

Other details:

Company's Cost of Capital10%

Corporate Tax Rate 30%

All lease payments are received in advance, at the start of the year - (annuity due).

Required:

What is the ANNUAL LEASE PAYMENT that ABC Plant Hire should quote XYZ Manufacturing?

(PLEAE USE EXCEL)