A company is considering the purchase of new equipment for $105,000. The projected annual net cash flows are $41,000. The machine has a useful life of 3 years and no salvage value. Management of the company requires a 12% return on investment. The present value of an annuity of 1 for various periods follows: Periods Present value of an annuity of 1 at 12% 1 0.8929 2 1.6901 3 2.4018 What is the net present value of this machine assuming all cash flows occur at year-end?

$35,000

$5,000

$(6,526)

$40,000

$96,072