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1 10 points A university student painter is considering the purchase of a new air compressor and paint gun to replace an old paint sprayer
1 10 points A university student painter is considering the purchase of a new air compressor and paint gun to replace an old paint sprayer (Both items belong to Class 9 and have a 25% CCA rate.) These two new items cost $13.800 and have a useful life of four years, at which time they can be sold for $3,400 The old paint sprayer can be sold now for $680 and could be scrapped for $430 in four years. The entrepreneurial student believes that operating revenues will increase annually by $9.800. The tax rate is 22 and the required rate of return is 15% What is the NPV of the new equipment? (Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit S sign in your response.) It NPV forces Should the purchase be made? 0 Yes NO
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