Billit Corporation is considering leasing a machine to a client for five years. The machine sells for $100,000 cash. The incremental borrowing rate...

Billit Corporation is considering leasing a machine to a client for five years. The machine sells for $100,000 cash. The incremental borrowing rate is 8%. The implicit rate is unknown. Payments are quarterly and start at the commencement of the lease. What is the quarterly lease payment? Show your work.

Quarterly:

Calculation of Initial Lease Liability:

Quaterly Payment:

Non-Lease Component*:

Minimum Lease Payment:

Present Value Factor:

Present Value of Mininum Lease Payment: