Morton co. is considering leasing a price of equipment. The equipment could be leased for 5000 per year payable at end of year next four years or purchased outright for 18,000. if leased the lessor would pay for all maintenace that would normally cost 400 per year paid at year end. morton would want the euipment at end of lease term. the equipment to have market vprice of 1000 end of 4 years

The interest rate is for borrowing is 8 percent and tax rate is 40 percent. Do a lease vs buy anaylis and tell which option is better?