The XYZ Co. has an after-tax cost of borrowing of 10 percent and is subject to a 35 percent tax rate. The company is considering the purchase of a machine for $100,000. With the heavy use, there will be no salvage value. The straight-line method is used for depreciation. The company wants to lease out the machine for 5 years at a required return of 15 percent. Calculate the net cost of the annual lease payments XYZ will charge a lessee. The first lease payment starts once the contract is signed.

a) 27104

b) 29318

c) 33716

d) 30544

e) 19057