A company is planning to invest in new machinery with a purchase price of P1, 300,000. Installation cost is P200, 000. The new machine will contribute to the cash inflow of P500, 000 annually. The machine has an estimated useful life of 10 years, no salvage value. The company is expecting a 22% return on all of its investment. The present value rate is 4.49409.

The net present value of the investment is

Select one:

a. P898,818

b. P700,000

c. P500,000

d. P461,590