1. The management of Kunkel Company is considering the purchase of a $29,000 machine that would reduce operating costs by $6,500 per year. At the end of the machines five-year useful life, it will have zero salvage value. The companys required rate of return is 16%.

1. Determine the net present value of the investment in the machine.

2. What is the difference between the total, undiscounted cash inflows and cash outflows over the entire life of the machine?

Complete this question by entering your answers in the tabs below.

Determine the net present value of the investment in the machine. (Negative amount should be indicated by a minus sign. Use the appropriate table to determine the discount factor(s). Round your final answer to the nearest whole dollar amount.)

the net present value:

Total difference in undiscounted cash inflows and outflows:

{- ) EXHIBIT 12B-2 Present Value of an Annuity of $1 in Arrears; 20% 21% Periods 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 15% 16% 17% 18% 19% 22% 23% 24% 25% 0.926 0.917 1 0.962 0.952 0.943 0.935 0.909 0.901 0.893 0.885 0.877 0.870 0.862 0.855 0.847 0.840 0.833 0.826 0.820 0.813 0.806 0800 1.859 1.783 1.736 1.713 2 1.886 1.833 1.808 1.759 1.690 1.668 1.647 1.626 1.605 1.585 1.566 1.547 1.528 1.509 1.492 1.474 1457 1440 1.981 1.952 3 2.775 2.723 2.673 2.624 2.577 2.531 2.487 2.444 2.402 2.361 2.322 2.283 2.246 2.210 2.174 2.140 2.106 2.074 2.042 2.011 3.630 3.312 3.240 3.170 4 3.546 3.465 3.387 3.102 3.037 2.974 2.914 2.855 2.798 2743 2.690 2.639 2.589 2.540 2.494 2.448 2.404 2.362 3.890 3.791 5 4.452 4.329 4.212 4.100 3.993 3.696 3.605 3.517 3.433 3.352 3.274 3199 3.127 3.058 2.991 2.926 2.864 2.803 2.745 2.689 5.242 5.076 4.917 4.767 4.623 4.486 4.355 4.231 4.111 3.998 3.889 3.784 3.685 3.589 3.498 3.410 3.326 3.245 3.167 3.092 3.020 2.951 6.002 5.786 5.582 5.206 7 5.389 5.033 4868 4.712 4.564 4.423 4.288 4.160 4.039 3.922 3.812 3.706 3.605 3.508 3.416 3.327 3.242 3161 8 6.733 6.463 6.210 5.971 5.747 5.535 5.335 5.146 4968 4.799 4.639 4.487 4.344 4.207 4078 3.954 3.837 3726 3.619 3.518 3.421 3.329 7.435 9 7.108 6.802 6.515 6.247 5.995 5.759 5.537 5.328 5.132 4.946 4772 4.607 4451 4.303 4.163 4.031 3.905 3.786 3.673 3.566 3.463 7.360 7.024 6.710 10 8.111 7.722 6.418 6.145 5.889 5.650 5.426 5.216 5.019 4.833 4.659 4.494 4.339 4.192 4.054 3.923 3.799 3.682 3.571 8.760 7.887 7.499 11 8.306 7.139 6.805 6.495 6.207 5.938 5.687 5.453 5.234 5.029 4.836 4656 4.486 4.327 4.177 4.035 3.902 3.776 3.656 4.439 4.2784.127 3.985 3.851 3.725 7.943 12 9.385 8.863 8.384 7.536 7.161 6.814 6.492 6.194 5.918 5.660 5.421 5.197 4.988 4.793 4.611 4.910 4.715 13 9.986 9.394 8.853 8.358 7.904 7.487 7.103 6.750 6.424 6.122 5.842 5.583 5.342 5.118 4.533 4.362 4.203 4.053 3.912 3.780 10.563 9.899 8.745 8.244 7.786 14 9.295 7.367 6.982 6.628 6.302 6.002 5.724 5.468 5.229 5.008 4.802 4.611 4.432 4.265 4.108 3.962 3.824 15 11.118 10.380 9.712 9.108 8.559 8.061 7.606 7191 6.811 6.462 6.142 5.847 5.575 5.324 5.092 4.876 4.675 4.489 4.315 4153 4.001 3.859 8.851 4.033 3.887 16 11.652 10.838 10.106 9.447 8.313 7.824 7379 6.974 6.604 6.265 5.954 5.668 5.405 5.162 4.938 4.730 4.536 4.357 4.189 4.059 3.910 17 12.166 11.274 10.477 9.763 9.122 8.544 8.022 7549 7.120 6.729 6.373 6.047 5.749 5.475 5.222 4.990 4775 4.576 4.391 4.219 9.372 18 12.659 11.690 10.828 10.059 8.756 8.2017.702 7.250 6.840 6.467 6.128 5.818 5.534 5.273 5.033 4.812 4.608 4.419 4.243 4080 3.928 13.134 19 12.085 11.158 10.336 9.604 8.950 8.365 7839 7.366 6.938 6.550 6.198 5.877 5.584 5.316 5.070 4.843 4.635 4.442 4.263 4.097 3.942 20 13.590 12.462 11.470 10.594 9.818 9.129 8.514 7963 7.469 7.025 6.623 6.259 5.929 5.628 5.353 5.101 4.870 4.657 4.460 4.279 4.110 3.954 21 14.029 12.821 11.764 10.836 10.017 9.292 8.649 8.075 7562 7102 6.687 6.312 5.973 5.665 5.384 5.127 4.891 4675 4.476 4.292 4121 3.963 22 14.451 13.163 12.042 11.061 10.201 9.442 8.772 8.176 7.645 7170 6.743 6.359 6.011 5.696 5.4105.149 4.909 4.690 4.488 4.302 4130 3.970 4.137 3.976 23 14.857 13.489 12.303 11.272 10.371 9.580 8.883 8.266 7718 7.230 6.792 6.399 6.044 5.723 5.432 5.167 4.925 4703 4.499 4.311 10.529 24 15.247 13.799 12.550 11.469 9.707 8.985 8.348 7784 7.283 6.835 6.434 6.073 5.746 5.451 5182 4.937 4.713 4.507 4.318 4143 3.981 4.948 4.721 25 15.622 14.094 12.783 11.654 10.675 9.823 9.077 8.422 7.843 7.330 6.873 6.464 6.097 5.766 5.467 5.195 4.514 4.323 4.147 3.985 3.988 26 15.983 14.375 13.003 11.826 10.810 9.929 9.161 8.488 7.896 7.372 6.906 6.491 6.118 5.783 5.480 5.206 4.956 4.728 4.520 4.328 4151 27 16.330 14.643 13.211 11.987 10.935 10.027 9.237 8.548 7.943 7409 6.935 6.514 6.136 5.798 5.492 5.215 4964 4.734 4.524 4.332 4.154 3.990 11.051 28 16.663 14.898 13.406 12.137 10.116 9.307 8.602 7984 7441 6.961 6.534 6.152 5.810 5.502 5.223 4.970 4.739 4.528 4.335 4.157 3.992 16.984 15.141 29 13.591 12.278 11.158 10.198 9.370 8.650 8.022 7470 6.983 6.551 6.166 5.820 5.510 5.229 4.975 4.743 4.531 4.337 4.159 3.994 3.995 3 17.292 15.372 13.765 12.409 11.258 10.274 9.427 8.694 8.055 7496 7003 6.566 6.177 5.829 5.517 5.235 4.979 4746 4534 4.339 4.160 19.793 17159 40 15.046 13.332 11.925 10757 9.779 8.951 8.244 7.634 7105 6.642 6.233 5.871 5.548 5.258 4.997 4.760 4.544 4.347 4.166 3.999 EXHIBIT 12B-1 Present Value of $1; Periods 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 15% 16% 17% 18% 19% 20% 21% 22% 23% 24% 25% 1 0.962 0.952 0.943 0.935 0.926 0.917 0.909 0.901 0.893 0.885 0.877 0.870 0.862 0.855 0.847 0.840 0.833 0.826 0.820 0.813 0.806 0.800 0.925 0.907 0.890 0.873 0.857 0.842 0.826 0812 0.797 0.783 0.769 0756 0.743 0.731 0718 0.706 0694 0.683 0.672 0.661 0.650 0.640 3 0.889 0.864 0.840 0.816 0.794 0772 0.751 0731 0.712 0.693 0.675 0.658 0.641 0.624 0.609 0.593 0.579 0.564 0.551 0537 0.524 0.512 4 0.855 0.823 0.792 0763 0735 0.708 0.683 0.659 0.636 0.613 0.592 0.572 0.552 0.534 0.516 0499 0482 0.467 0.451 0437 0.423 0410 0.822 0784 0.747 0713 0.681 0.650 0.621 0.593 0.567 0.543 0.519 0.497 0.476 0456 0.437 0.419 0.402 0.386 0.370 0.355 0.341 0.328 6 0.790 0746 0.705 0.666 0.630 0.596 0.564 0.535 0.507 0.480 0.456 0.432 0.410 0.390 0.370 0352 0.335 0.319 0.303 0.289 0.275 0.262 7 0.760 0711 0.665 0.623 0.583 0.547 0.513 0.482 0.452 0425 0.400 0.376 0.354 0.333 0.314 0.296 0.279 0.263 0249 0.235 0.222 0.210 0.731 0677 0.627 0.582 0.540 0.502 0.467 0.434 0.404 0.376 0.351 0.327 0.305 0.285 0.266 0.249 0.233 0.218 0.204 0191 0.179 0.168 9 0.703 0.645 0.592 0.544 0.500 0460 0.424 0.391 0.361 0.333 0.308 0.284 0.263 0.243 0.225 0.209 0194 0180 0.167 0.155 0144 0134 10 0.676 0.614 0.558 0.508 0.463 0.422 0.386 0.352 0.322 0.295 0.270 0.247 0.227 0.208 0191 0176 0162 0149 0.137 0.126 0116 0.107 11 0.650 0.585 0.527 0475 0.429 0.388 0.350 0.317 0.287 0.261 0.237 0.215 0.195 0178 0162 0148 0135 0123 0112 0.103 0.094 0.086 12 0.625 0.557 0.497 0444 0.397 0.356 0.319 0.286 0.257 0.231 0.208 0187 0.168 0152 0137 0.124 0112 0.102 0.092 0.083 0.076 0.069 13 0.601 0.530 0.469 0.415 0.368 0.326 0.290 0.258 0.229 0.204 0182 0.163 0145 0130 0116 0.104 0093 0.084 0.075 0.068 0.061 0.055 062 0.055 0.049 0.044 14 0.577 0.505 .442 0.388 0.340 0.299 0.263 0.232 0.205 0181 0.160 0141 0.125 0111 0.099 088 0.078 0.069 15 0.555 0.481 0.417 0.362 0.315 0.275 0.239 0.209 0.183 0.160 0.140 01230.108 0.095 0.084 0.074 0.065 0.057 0.051 0.045 0.040 0.035 16 0.534 0.458 0.394 0.339 0.292 0.252 0.218 0188 0.163 0141 0.123 0107 0.093 0.081 0.071 0.062 0.054 0.047 0.042 0.036 0.032 0.028 17 0.513 0436 0.371 0.317 0.270 0.231 0198 0170 0.146 0125 0.108 0.093 0.080 0.069 0.060 0.052 0.045 0.039 0.034 0.030 0.026 0.023 18 0.494 0.416 0.350 0.296 0.250 0.212 0.180 0.153 0130 0111 0.095 0.081 0.069 0.059 0.051 0.044 0.038 0.032 0.028 0.024 0.021 0.018 19 0.475 0.396 0.331 0.277 0.232 0194 0.164 0138 0.116 0.098 0.083 0.070 0.060 0.051 0.043 0.037 0.031 0.027 0.023 0.020 0.017 0.014 20 0.456 0.377 0.312 0.258 0.215 0178 0.149 0.124 0104 0.087 0.073 0.061 0.051 0.043 0.037 0.031 0.026 0.022 0.019 0.016 0.014 0.012 21 0.439 0.359 0.294 0.242 0.199 0.164 0.135 0112 0.093 0.077 0.064 0.053 0.044 0.037 0.031 0.026 0.022 0.018 0.015 0.013 0.011 0.009 0.009 0.007 22 0.422 0.342 0.278 0.226 0.184 0.150 0123 0.101 0.083 0.068 0.056 0.046 0.038 0032 0.026 0.022 0.018 0.015 0.013 0011 0.170 0.112 23 0.406 0.326 0.262 0.211 0.138 0.091 0.074 0.060 0.049 0.040 0.033 0.027 0.022 0.018 0.015 0.012 0.010 0.009 0.007 0.006 24 0.390 0.310 0.247 0197 0.158 0126 0.102 0.082 0.066 0.053 0.043 0.035 0.028 0.023 0.019 0.015 0.013 0.010 0.008 0.007 0.006 0.005 25 0.375 0.295 0.233 0184 0.146 0.116 0.092 0.074 0.059 0.047 0.038 0.030 0.024 0.020 0.016 0.013 0.010 0.009 0.007 0.006 0.005 0.004 26 0.361 0.281 0.220 0.172 0.135 0.106 0.084 0.066 0.053 0.042 0.033 0.026 0.021 0017 0.014 0.011 0.009 0.007 0.006 0.005 0.004 0.003 27 0.347 0.268 0.207 0161 0.125 0.098 0.076 0.060 0.047 0.037 0.029 0.023 0018 0.014 0011 0.009 0.007 0.006 0.005 0.004 0.003 0.002 28 0.333 0.255 0.196 0150 0.116 0.090 0.069 0.054 0.042 0.033 0.026 0.020 0.016 0012 0.010 0.008 0.006 0.005 0.004 0.003 0.002 0.002 29 0.321 0.243 0.185 0.141 0.107 0.082 0.063 0.048 0.037 0.029 0.022 0.017 0.014 0.011 0.008 0.006 0.005 0.004 0.003 0.002 0.002 0.002 30 0.308 0231 0.174 0131 0.099 0.075 0.057 0.044 0.033 0.026 0.020 0.015 0.012 0.009 0.007 0.005 0.004 0.003 0.003 0.002 0.002 0.001 0.008 0.005 0.004 0.003 0.002 0.001 0.001 0.001 0.000 0.000 0.000 0.000 0.000 40 0.208 0.142 0.097 0.067 0.046 0.032 0.022 0.015 0.011