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Chew Products needs to replace its equipment. It can be used for five years and will have no salvage value. The equipment costs $930,000. The

Chew Products needs to replace its equipment. It can be used for five years and will have no salvage value. The equipment costs $930,000. The firm can lease it for $245,000 a year (payable at the end of the year), or it can borrow the money to purchase the equipment at 9%. The firm's tax rate is 39%. The CCA rate is 20% (Class 8). What is the net advantage to leasing if the company will not pay taxes for the next five years? a.. $136,269 b. $138,706 c. -$88,132 d. -$22,964 e. -$108,731

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