A company is evaluating two machine systems. The company will select only one project using the replacement chain method.

Machine A's estimated cash flows:

Year 0: -$100,000

Year 1: $60,000

Year 2: $60,000

Machine B's estimated cash flows:

Year 0: -$100,000

Year 1: $48,000

Year 2: $48,000

Year 3: $48,000

The company's cost of capital is 10%.

Taking into consideration of unequal life of the systems, what is the NPV of machine A using the replacement chain method?

	a.	$10,369.67
	b.	$9,475.14
	c.	$2.985.45
	d.	$11,586.29
	e.	$4,123.78