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a. A new operating system for an existing machine is expected to cost $750.000 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 $750.000 and have a useful life of six years. The system yields an incremental after-tax income of $220,000 each year after deducting its straight-line depreciation. The predicted salvage value of the system is $24,400. b. A machi ine costs $510,000, has a $24.800 salvage value, is expected to last eight years, and will generate an after-tax income of $68,000 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 S1. EV of $1, PVA of $1, and FVA 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 A new operating system for an existing machine is expected to cost $750,000 and have a useful ilfe of six years. The systenm lds an incremental after-tax income of $220,000 each year after deducting its straight-line depreciation. The predicted salvage value of the system is $24,400. Round your answers to the nearest whole dollar.).. AmountPV FactorPresent Required 8> Prev6 of 6 Next 20

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