XYZ Corp. is purchasing new equipment with a cash cost of $199,636. The manufacturer has offered to accept $50,000 payment (including interest) at the end of each of the next five years.

1.33823

1.46933

1.61051

0.74726

0.68058

0.62092

5.63709

5.86660

6.10510

4.21236

3.99271

3.79079

5

1.76234

0.56743

6.35285

3.60478

4.46511

4.31213

4.16986

4.03735

10%4

12%

1. What is the total interest expense that would be incurred by XYZ Corp. over the term of the loan with the manufacturer?

2 What is the interest rate charged by the manufacturer?

3. What would the annual payments be if XYZ obtained financing from the bank @ 6%?