Mapua is considering upgrading the capability of its computer, which has been bought 2 years ago at a cost of P10M with an annual operating cost of P1,349,046, and if retained for 4 more years, will be sold by then for P500,000. But if it is going to be sold today, it will have a price of 5,979,339. The upgrading requires a medium-size computer having a first cost, life, salvage value, and annual operating costs of P3,557,112, 5 years, P300,000, and P753,421, respectively. This is to be considered the 1st Option. The 2nd Option is to buy larger computer, which has a cost of P4.2M, P1.12M salvage value, and P500,000 annual operating cost per year. It would last 5 years. The last option is to lease a computer. The computer has annual payment of P1.4M per year and initial payment of P100,000. It would last 4 years. Assume that the interest rate is 12% per year. What is the Annual Equivalent Cost of the 1st Option?