(Net advantage to leasing) Rashid Singh, the president of Surf-Side Beer Distributors of Salina, Kansas, has decided that his firm must acquire a new machine that costs $800,000. The firm’s corporate borrowing rate is 12%, The machine can be leased for $110,000 per year for its 10-year life. If the firm leases, it gets no salvage value. If it owns, the expected salvage value is $50,000. Maintenance costs will be the same whether Surf-Side leases or buys. The firm would use straight-line depreciation to a net book value of $50,000, its tax rate is 40%, and the cost of capital for the machine is 14%. Calculate the net advantage to leasing.