The Wildcat Oil Company is trying to decide whether to lease or buy a new computer$-$

assisted drilling system for its oil exploration business. Management has decided that it

must use the system to stay competitive; it will provide $$3\mathrm{.}5$ million in annual pretax cost

savings. The system costs $$9\mathrm{.}4$ million and will be depreciated straight$-$line to zero over

five years. Wildcat's tax rate is $21$ percent, and the firm can borrow at $8$ percent. Lambert

Leasing Company is willing to lease the equipment to Wildcat. Lambert's policy is to

require its lessees to make payments at the start of the year. Suppose it is estimated that

the equipment will have an aftertax residual value of $$1,025,000$ at the end of the lease.

What is the maximum lease payment acceptable to Wildcat? $($Do not round intermediate

calculations and enter yuor answer in dollars, not millions, rounded to $2$ decimal

places, e$.$g$.,1,234,567\mathrm{.}89.$

Maximum lease payment