A hospital is considering the possibility of two new purchases: new MRI equipment and new biopsy equipment. Each project requires an investment of $850,000. The expected life for each is five years with no expected salvage value. The net cash inflows associated with the two independent projects are as follows:

Required:
Compute the net present value of each project, assuming a required rate of 12 percent.LO1

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Year MRI Equipment Biopsy Equipment 12345 $400,000 200,000 $100,000 100,000 300,000 200,000 200,000 400,000 100,000 475,000