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a. A new operating system for an existing machine is expected to cost $560,000 and have a useful life of six years. The system yields

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a. A new operating system for an existing machine is expected to cost $560,000 and have a useful life of six years. The system yields an incremental after-tax income of $250,000 each year after deducting its straight-line depreciation. The predicted salvage value of the system is $16,800. b. A machine costs $460,000, has a $21,500 salvage value, is expected to last eight years, and will generate an after-tax income of $80,000 per year after straight-line depreciation Assume the company requires a 12% rate of return on its investments. Compute the net present value of each potential investment. (PV of $1. FV of $1. PVA of $1, and EVA of $1) (Use appropriate factor(s) from the tables provided.) Complete this question by entering your answers in the tabs below. Required A Required B ces A new operating system for an existing machine is expected to cost $560,000 and have a yields an incremental after-tax income of $250,000 each year after deducting its straight salvage value of the system is $16,800. (Round your answers to the nearest whole dollar Preser X Amount py Factor Select Chart Cash Flow Annual cash flow Residual value Net present value > Required B flegur

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