The net present value of the investment in the machine is

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1. The Sanchaz Corporation is considering the purchase of a new machine that will cost the company $24,000 and will be worth nothing at the end of three years. Their current tax rate is 20% and they will depreciate the machine $8,000 each year for three years. The machine is expected to generate $8,500 of cash inflows each year over the next 3 years. Sanchaz Corporation’s cost of capital is 4%. The net present value of the investment in the machine is?

2. Parsley, Pepper and Thyme are partners in the Spices Company. Their partnership income sharing agreement provides that Parsley and Thyme are to receive salary allowances of $118,800 and $67,200, respectively and that any remaining income or loss is to be divided equally among all partners. If the company's income was $156,000, Thyme's share would be:

Reference no: EM13793449

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