What is the net present value of selecting the new machine

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Question - The Coleman Co. produces canned tomatoes and it is considering the purchase of a new machine that would increase the speed of the canning process and save money. The cost of this machine is $40,000. The annual cash flows are projected to be the following:

Year

Cash Flow

1

$5,000

2

$10,000

3

$25,000

4

$15,000

5

$20,000

Required - What is the net present value of selecting the new machine, assuming an interest rate of 8%?

A. $17,686

B. $97,686

C. $57,686

D. $7,868

Reference no: EM132529802

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