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Determine the machine net present value

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Question - Ivanhoe Manufacturing is considering the purchase of new computerized equipment. The machine costs $91800 and would generate $23760 in annual cost savings over its 5-year life. At the end of 5 years, the equipment would have a $5400 salvage value. Ivanhoe's required rate of return is 16%. Using the present value tables, determine the machine's net present value?

a. $118800.

b. $-14003.

c. $-11432.

d. $77797.

Reference no: EM133066935

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