Nodhead College needs a new computer. It can either buy it for $260,000 or lease it from Compulease. The lease terms require Nodhead to make six annual payments (prepaid) of $64,000. Nodhead pays no tax. Compulease pays tax at 40%. Compulease can depreciate the computer for tax purposes over five years. The computer will have no residual value at the end of year 5. The interest rate is 10%.

What is the NPV of the lease for Nodhead College? What is the NPV for Compulease? What is the overall gain from leasing?