Kincaid Company owns equipment with a cost of $365,300 and accumulated depreciation of $52,800 that can be sold for $276,000, less a 3% sales commission. Alternatively, Kincaid Company can lease the equipment for three years for a total of $285,200, at the end of which there is no residual value. In addition, the repair, insurance, and property tax expense that would be incurred by Kincaid Company on the equipment would total $16,500 over the three year lease.

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a. Prepare a differential analysis on August 7 as to whether Kincaid Company should lease (Alternative 1) or sell (Alternative 2) the equipment. If required, use a minus sign to indicate a loss.

	Lease Equipment (Alternative 1)	Sell Equipment (Alternative 2)	Differential Effects (Alternative 2)
Revenues	$fill in the blank 1cf2240cb036041_1	$fill in the blank 1cf2240cb036041_2	$fill in the blank 1cf2240cb036041_3
Costs	fill in the blank 1cf2240cb036041_4	fill in the blank 1cf2240cb036041_5	fill in the blank 1cf2240cb036041_6
Profit (Loss)	$fill in the blank 1cf2240cb036041_7	$fill in the blank 1cf2240cb036041_8	$fill in the blank 1cf2240cb036041_9

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b. Should Kincaid Company lease (Alternative 1) or sell (Alternative 2) the equipment?