A company is considering the purchase of new equipment for $84,000. The projected after-tax net...
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A company is considering the purchase of new equipment for $84,000. The projected after-tax net income is $4,300 after deducting $28,000 of depreciation. The machine has a useful life of 3 years and no salvage value. Management of the company requires a 9% return on investment. The present value of an annuity of 1 for various periods follows: Periods Present value of an annuity of 1 at 9% 1 0.9174 2 1.7591 3 2.5313 What is the net present value of this machine assuming all cash flows occur at year-end?
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