Macopolo Tiles Itd has decided to buy equipment worth $$158000.$ If it were to lease

the equipment, the manufacturer would provide for financing over $7$ years. The lease

calls for annual payments of $$26700.$ Lease payments are made in advance at the

end of each $7$ years. If the asset is purchased, Macopolo Tiles Itd would finance it

with a year $7$ year loan at $12\%.$ The company is in a $35\%$ tax bracket. The asset falls

in the $5$ year property class for depreciation purposes and we use the following

published rates:

Required

Showing all necessary calculations, which alternative should Macopolo Tiles Itd use

for financing its equipment's