?Beryl's Iced Tea currently rents a bottling machine for $ 54 000 per? year, including all...

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?Beryl's Iced Tea currently rents a bottling machine for $ 54000 per? year, including all maintenance expenses. It isconsidering purchasing a machine instead and is comparing two?options: a. Purchase the machine it is currently renting for $ 160000. This machine will require $ 20 000 per year in ongoingmaintenance expenses. b. Purchase a? new, more advanced machine for$ 260 000. This machine will require $ 16 000 per year in ongoingmaintenance expenses and will lower bottling costs by $ 15 000 peryear.? Also, $ 37 000 will be spent up front training the newoperators of the machine. Suppose the appropriate discount rate is7 % per year and the machine is purchased today. Maintenance andbottling costs are paid at the end of each? year, as is the rentalof the machine. Assume also that the machines will be depreciatedvia the? straight-line method over seven years and that they havea? ten-year life with a negligible salvage value. The marginalcorporate tax rate is 35 %. Should? Beryl's Iced Tea continue to?rent, purchase its current? machine, or purchase the advanced?machine? To make this? decision, calculate the NPV of the FCFassociated with each alternative.
The NPV of renting the current machine is ?$ nothing. ?(Round tothe nearest? dollar.)
The NPV of purchasing the current machine is ?$ nothing. ?(Roundto the nearest? dollar.)
The NPV of purchasing the advanced machine is ?$ nothing.?(Round to the nearest? dollar.)
Which of the following is the best? choice? ? (Select the bestchoice? below.)
A. Rent the current machine. B. Purchase the current machine. C.Purchase the advanced machine.

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?Beryl's Iced Tea currently rents a bottling machine for $ 54000 per? year, including all maintenance expenses. It isconsidering purchasing a machine instead and is comparing two?options: a. Purchase the machine it is currently renting for $ 160000. This machine will require $ 20 000 per year in ongoingmaintenance expenses. b. Purchase a? new, more advanced machine for$ 260 000. This machine will require $ 16 000 per year in ongoingmaintenance expenses and will lower bottling costs by $ 15 000 peryear.? Also, $ 37 000 will be spent up front training the newoperators of the machine. Suppose the appropriate discount rate is7 % per year and the machine is purchased today. Maintenance andbottling costs are paid at the end of each? year, as is the rentalof the machine. Assume also that the machines will be depreciatedvia the? straight-line method over seven years and that they havea? ten-year life with a negligible salvage value. The marginalcorporate tax rate is 35 %. Should? Beryl's Iced Tea continue to?rent, purchase its current? machine, or purchase the advanced?machine? To make this? decision, calculate the NPV of the FCFassociated with each alternative.The NPV of renting the current machine is ?$ nothing. ?(Round tothe nearest? dollar.)The NPV of purchasing the current machine is ?$ nothing. ?(Roundto the nearest? dollar.)The NPV of purchasing the advanced machine is ?$ nothing.?(Round to the nearest? dollar.)Which of the following is the best? choice? ? (Select the bestchoice? below.)A. Rent the current machine. B. Purchase the current machine. C.Purchase the advanced machine.