FIND THE LEASE RENTAL AND TAX AMOUNT for the four year

                                                                                                                                                                       

	Year 0	Year 1	Year 2	Year 3	Year 4
Cost of owning
Net Purchase price	$ 15,00,000
Maintenance Expenses	$ 75,000	$ 75,000	$ 75,000	$ 75,000
Tax Savings on Maintenance Expenses	$ -30,000	$ -30,000	$ -30,000	$ -30,000
Depreciation Tax savings		$ -1,98,000	$ -2,70,000	$ -90,000	$ -42,000
Salvage Value					$ -2,50,000
Tax on Salvage Value					$ 1,00,000
Net Cash Flow	$ 15,45,000	$ -1,53,000	$ -2,25,000	$ -45,000	$ -1,92,000
Cost of leasing
Lease Payment		$ 4,00,000	$ 4,00,000	$ 4,00,000	$ 4,00,000
Tax Savings on Lease Payments		$ -1,60,000	$ -1,60,000	$ -1,60,000	$ -1,60,000
Maintenance Expenses	$ 75,000	$ 75,000	$ 75,000	$ 75,000
Tax Savings on Maintenance Expenses	$ -30,000	$ -30,000	$ -30,000	$ -30,000
Net Cash Flow	$ 45,000	$ 2,85,000	$ 2,85,000	$ 2,85,000	$ 2,40,000
Net Advantage of leasing
PVF @15% or 9% after tax	1.0000	0.9174	0.8417	0.7722	0.7084
Present Value of Cost of Owning	$ 10,44,489
Present Value of Cost of leasing	$ 9,36,441
Net Advantae of Leasing	$ 1,08,048

Net advantage of Leasing= $108,048

The IRR of the above cash flow is

Year	Particulars	Amount
0	Cost of Asset
1	Lease Rental+Taxsavings on Depreciation
2	Lease Rental+Taxsavings on Depreciation
3	Lease Rental+Taxsavings on Depreciation
4	Lease Rental+Taxsavings on Depreciation+Salvage avlue after tax
	IRR at 9%guess (after tax)	24.57%