Almendarez Corporation is considering the purchase of a machine that would cost $$320,000$ and would last for $7$ years. At the end of $7$ years, the machine would have a salvage value of $$51,000.$ By reducing labor and other operating costs, the machine would provide annual cost savings of $$72,000.$ The company requires a minimum pretax return of $18\%$ on all investment projects. $($Ignore income taxes.$)$

Click here to view Exhibit $7$B$-1$ and Exhibit $7$B$-2,$ to determine the appropriate discount factor$($s$)$ using the tables provided.

The present value of the annual cost savings of $$72,000$ is closest to:

Multiple Choice

$$22,608$

$$874,298$

$$504,000$

$$274,464$