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3-The Plastic Iron Company has decided to acquire a new electronic milling machine.
3-The Plastic Iron Company has decided to acquire a new electronic milling machine.  Plastic Iron can purchase the machine for $87,000 which has an expected life of 8 years and will be depreciated using 7 class MACRS rates of .1428, .2449, .1749, .125, .0892, .0892, .0892 and any remainder in year 8.  Miller Leasing has offered to lease the machine to Plastic Iron for $14,000 a year for 8 years.  Plastic Iron has an 18.64% cost of equity, 12% cost of debt, a 1:1 D/E ratio and faces a 34% marginal tax rate.  Should they lease or buy?Show all work. MS word file or an Excel file that shows step-by-step solution to the problems.
