The X company is considering the acquisition of a new processor that has an estimated installed

cost of $57,000. The processor has an expected life of 5 years and will be depreciated over a 5

year ACRS life to a zero salvage value. However, it is expected that the processor can be sold at

that time for $6,000. If purchased, the entire $57,000 would be borrowed at an interest rate of

9%. A capital budgeting analysis results in a positive NPV for the project. An alternative to

purchase is to lease the asset for an annual lease payment of $13,500. The lease includes

maintenance services estimated to cost Company C $3,000 per year if they were not included in

the lease payment. Company C