1. Lakeside Winery is considering expanding its wine-making operations. The new equipment would cost $138,000, would be depreciated on a straight line basis over its 5-year life, and would have a zero value at the end of the 5th year. The estimated revenue generated from the new equipment is $86,000 a year. The estimated expenses and costs of the new project are $35,600 each year. The project will require $3,000 of net working capital, which is recoverable at the end of the project. What is the net present value of this project at a required return of 12 percent and a tax rate of 34 percent?