Alan Long has just learned he has won a $500,400prize in the lottery. The lottery has given him two options for receiving the payments. (1) If Alan takes all the money today, the state and federal governments will deduct taxes at a rate of48% immediately. (2) Alternatively, the lottery offers Alan a payout of20equal payments of $37,800with the first payment occurring when Alan turns in the winning ticket. Alan will be taxed on each of these payments at a rate of26%.

Assuming Alan can earn an10% rate of return (compounded annually) on any money invested during this period, compute the present value of the cash flows for annuity payout.(Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places, e.g. 458,581.)

Present value of annuity payout?

Please help and show work. Thank you.