20 KSU Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that it currently isn't equipped to do. Estimates regarding each machine are provided below. Original cost Machine A $106,000 Machine B $175,000 Estimated life 8 years Salvage value -0- 8 years -0- Estimated annual cash inflows $30,000 $45,000 Estimated annual cash outflows $10,000 $15,000 TABLE 3 Present Value of 1 (n) Periods 4% 5% 6% 7% 8% 9% 10% 11% 12% 15% 1 .96154 .95238 .94340 0.93458 .92593 .91743 2 .92456 .90703 .89000 0.87344 .85734 .84168 3 .88900 .86384 .83962 0.81630 .79383 .77218 4 .85480 .82270 .79209 0.76290 .73503 .70843 .68301 5 .82193 .78353 .74726 0.71299 .68058 .64993 .62092 6 .79031 .74622 .70496 0.66634 .63017 .59627 .56447 7 .75992 .71068 .66506 0.62275 .58349 .54703 .51316 .90909 .90090 .89286 .86957 .82645 .81162 .79719 .75614 .75132 .73119 .71178 .65752 .65873 .63552 .57175 .59345 .56743 .49718 .53464 .50663 .48166 .45235 .43233 .37594 8 .73069 .67684 .62741 0.58201 .54027 .50187 .46651 .43393 .40388 .32690 9 .70259 .64461 .59190 0.54393 .50025 .46043 .42410 .39092 .36061 .28426 10 .67556 .61391 .55839 0.50835 .46319 .42241 .38554 .35218 .32197 .24719 11 .64958 .58468 .52679 0.47509 .42888 .38753 .35049 .31728 .28748 .21494 12 .62460 .55684 .49697 0.44401 .39711 .35554 .31863 .28584 13 .60057 .53032 .46884 0.41496 .36770 .32618 .28966 .25751 14 .57748 .50507 .44230 0.38782 .34046 .29925 15 .55526 .48102 .41727 0.36245 .31524 .27454 .26333 .23199 .20462 .23939 .25668 .18691 .22917 .16253 .14133 16 .53391 .45811 .39365 0.33873 .29189 .25187 .21763 17 .51337 .43630 .37136 0.31657 .27027 .23107 18 .49363 .41552 .35034 0.29586 .25025 .21199 19 .47464 .39573 .33051 0.27615 .23171 .19449 .16351 .13768 .20900 .18270 .12289 .18829 .16312 .10687 .19785 .16963 .14564 .09293 .17986 .15282 .13004 .08081 .11611 .07027 20 .45639 .37689 .31180 0.25842 .21455 .17843 .14864 .12403 .10367 .06110 TABLE 4 Present Value of an Annuity of 1 (n) Payments 1 2 4% .96154 1.88609 5% 3 2.77509 4 3.62990 5 4.45182 6 5.24214 7 6.00205 8 6.73274 9 7.43533 10 8.11090 7.72173 11 8.76048 12 13 14 15 16 17 18 19 20 6% .95238 .94340 1.85941 1.83339 2.72325 2.67301 3.54595 3.46511 4.32948 4.21236 5.07569 4.91732 5.78637 5.58238 6.46321 6.20979 7.10782 6.80169 7.36009 8.30641 7.88687 9.38507 8.86325 8.38384 9.98565 9.39357 8.85268 10.56312 9.89864 9.29498 11.11839 10.37966 9.71225 11.65230 10.83777 10.10590 12.16567 11.27407 10.47726 12.65930 11.68959 10.82760 13.13394 12.08532 11.15812 13.59033 12.46221 11.46992 10% 7% 8% 9% 11% 12% 15% 0.93458 .92593 .91743 .90909 .90090 .89286 .86957 1.80802 1.78326 1.75911 1.73554 1.71252 1.69005 1.62571 2.62432 2.57710 2.53130 2.48685 2.44371 2.40183 2.28323 3.38721 3.31213 3.23972 3.16986 3.10245 3.03735 2.85498 4.10020 3.99271 3.88965 3.79079 3.69590 3.60478 3.35216 4.76654 4.62288 4.48592 4.35526 4.23054 4.11141 3.78448 5.38929 5.20637 5.03295 4.86842 4.71220 4.56376 4.16042 5.97130 5.74664 5.53482 5.33493 5.14612 4.96764 4.48732 6.51523 6.24689 5.99525 5.75902 5.53705 5.32825 4.77158 7.02358 6.71008 6.41766 6.14457 5.88923 5.65022 5.01877 7.49867 7.13896 6.80519 6.49506 6.20652 5.93770 5.23371 7.94269 7.53608 7.16073 6.81369 6.49236 6.19437 5.42062 8.35765 7.90378 7.48690 7.10336 6.74987 6.42355 5.58315 8.74547 8.24424 7.78615 7.36669 6.98187 6.62817 5.72448 9.10791 8.55948 8.06069 7.60608 7.19087 6.81086 5.84737 9.44665 8.85137 8.31256 7.82371 7.37916 6.97399 5.95424 9.76322 9.12164 8.54363 8.02155 7.54879 7.11963 6.04716 10.05909 9.37189 8.75563 8.20141 7.70162 7.24967 6.12797 10.33560 9.60360 8.95012 8.36492 7.83929 7.36578 6.19823 10.59401 9.81815 9.12855 8.51356 7.96333 7.46944 6.25933 Calculate the net present value and profitability index of each machine. Assume a 9% discount rate. (Round net present value to the nearest whole dollar, e.g. 5,275 and profitability index to 2 decimal places, e.g. 15.25. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Machine A Machine B Net present value Profitability index Which machine should be purchased