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Your corporation is considering purchasing equipment costing $67,000 which it expects to sell at the end of Year 4 for $21,500. The firm uses MACRS

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Your corporation is considering purchasing equipment costing $67,000 which it expects to sell at the end of Year 4 for $21,500. The firm uses MACRS depreciation, with rates of 33.33 percent, 44.44 percent, 14.82 percent, and 741 percent over Years 1 to 4, respectively. The equipment can be leased for $17,700 a year for four years. The firm can borrow at 6.5 percent and has a tax rate of 25 percent. What is the incremental annual cash flow for Year 4 if the company decides to lease the equipment rather than purchase it? A) -$32,930 B) -$30,641 OC) -$33,701 D) -$50,430 E) -$42.730

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