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Exercise 25-03 (Video) Marigold Inc. manufactures snowsuits. Marigold is considering purchasing a new sewing machine...

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Exercise 25-03 (Video) Marigold Inc. manufactures snowsuits. Marigold is considering purchasing a new sewing machine at a cost of $2.45 million. Its existing machine was purchased five years ago at a price of $1.8 million; six months ago, Marigold spent $55,000 to keep it operational. The existing sewing machine can be sold today for $241,293. The new sewing machine would require a one- time, $85,000 training cost. Operating costs would decrease by the following amounts for years 1 to 7: Year 1 $390,800 400,900 410,600 425,200 433,000 434,600 436,500 The new sewing machine would be depreciated according to the declining-balance method at a rate of 20%. The salvage value is expected to be $379,200. This new equipment would require maintenance costs of $97,100 at the end of the fifth year. The cost of capital is 9%. Click here to view PV table. Use the net present value method to determine the following: (If net present value is negative then enter with negative sign preceding the number e.g. -45 or parentheses e.g. (45). Round present value answer to 0 decimal places, e.g. 125. For calculation purposes, use 5 decimal places as displayed in the factor table provided.) Calculate the net present value. Net present values Screenshot

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