CLASS EXERCISE The management of The Alexandrov Company decided to acquire the use of hine to be used in its manufacturing process. The machine it needs is manufactured only by Chang, Incorporated. The machine can be used for ten years and then sold for $10,000 at the end of its useful life. Chang's management has presented Alexandrov with the following acquisition options: Lease: The machine could be leased for a ten-year period for an annual lease payment of $25,000, with the first payment due on the date that the agreement is signed. All maintenance and insurance costs for the machine, which are expected to be about $5,000 per year, would be paid by Chang and the machine would be returned to Chang at the end of the lease term. Purchase: The machine could be purchased for $130,000 in cash. Assuming that (i) Alexandrov and Chang will agree on a transaction on November 30, 2010, and (ii) the current interest rate for Alexandrov's long- term borrowing is 12%, which of the two options would be the most economically attractive to Alexandrov? Prepare a formal schedule to support your decision