Quick Express Ltd is considering leasing a computer. Details are as follows:
Lease term 3 years
Annual lease payments $100 in advance
Computer cost $360
Salvage zero
Depreciation straight line over 3 year life
Corporate tax rate 30%
Quick's borrowing cost 8%
What is the incremental after-tax cash flow from leasing in year 0?
-$360
$290
-$260
$360