Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new...

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Geary Machine Shop is considering a four-year project to improveits production efficiency. Buying a new machine press for $806,400is estimated to result in $268,800 in annual pretax cost savings.The press falls in the MACRS five-year class (MACRS Table), and itwill have a salvage value at the end of the project of $117,600.The press also requires an initial investment in spare partsinventory of $33,600, along with an additional $5,040 in inventoryfor each succeeding year of the project.
If the shop's tax rate is 33 percent and its discount rate is 16percent, what is the NPV for this project? (Do not roundyour intermediate calculations.)

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Geary Machine Shop is considering a four-year project to improveits production efficiency. Buying a new machine press for $806,400is estimated to result in $268,800 in annual pretax cost savings.The press falls in the MACRS five-year class (MACRS Table), and itwill have a salvage value at the end of the project of $117,600.The press also requires an initial investment in spare partsinventory of $33,600, along with an additional $5,040 in inventoryfor each succeeding year of the project.If the shop's tax rate is 33 percent and its discount rate is 16percent, what is the NPV for this project? (Do not roundyour intermediate calculations.)