CLASS EXERCISE The management of The Grissom Company has decided to acquire the use of production machinery that is manufactured only by Carter-Smith, Incorporated. The machinery has an expected useful life of 9 years. Grissom has the following acquisition options: LEASE: The machinery could be leased for a 6-year period for an annual lease payment of $96,075, with the first payment due on the date the agreement is signed. All maintenance and insurance costs ("executory costs") for the equipment, which are expected to be about $12,000 per year, would be paid by the lessee, and the equipment would be returned to the lessor at the end of the lease term. PURCHASE: The machinery could be purchased for $500,000 in cash. However, Grissom does not have the existing capability to absorb the annual maintenance and insurance costs and would also have to consider those costs in a purchase decision. Assume that (1) the transaction agreement will be signed on January 2, 2022; (2) the executory costs are considered to be paid at the end of each year; and (3) the current interest rate for long-term borrowing for lease/purchase transactions of this nature is 7%. Prepare a schedule that will help The Grissom Company make its acquisition decision.