Allied Aviation had a choice of buying or leasing their next ten-passenger turboprop twin. The cash price was KShs.30 million, but a 5-year lease could be obtained with annual payments of KShs. 5,000,000. If the plane were purchased, it would be depreciated straight-line over a 25-year life to a zero salvage value. In order to compare the purchase alternative to the lease alternative, it was estimated that the plane would still be worth KShs. 20,400,000 at the end of five years. Allied is in the 30% marginal income tax bracket. Compute the Net Advantage of Leasing at a discount rate of 12%. (5 Marks)

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