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Puan Bunga Lawang is working in a medical research laboratory and is evaluating the decision to acquire the medical research equipment. The cost of the

Puan Bunga Lawang is working in a medical research laboratory and is evaluating the decision to acquire the medical research equipment. The cost of the equipment is RM4,800,000 and it would be depreciated on a straight-line basis. Due to the hea\/y usage, it is estimated that at the end of four years the machine will be completely valueless. Puan Bunga Lawang may lease the equipment at RM1,430,000 per year for four years or purchase the equipment through the bank loan at an interest rate of 8%. The tax rate is 22%. Suggest to Puan Bunga Lawang should the laboratory buy or lease the equipment by showing the Net Advantage of Leasing (NAL) of the equipment. (6 Marks)

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