Direction: Read, interpret and analyze the problem to find the correct solution.

Ijarah is a concept used in Islamic commerce. Ijarah denotes a contract where one party transfers the right to use an item he owns to another party for a specified period in exchange for an agreed consideration. Colloquially, Ijarah is often called 'Islamic leasing'.

Cost of financing or purchase price = $150,000

Rate of profit = 10.5% flat/ annum

Period of lease = 12years (144 months)