Bilboa Company has a small truck that it uses for delivery. The truck is in bad repair and must be either overhauled or replaced with a new truck. The company has assembled the following information: Present Truck New Truck Purchase cost new 21,000 30,000 Remaining book value 11,500 - Overhaul needed now 7,000 - Annual cash operating costs 10,000 6,500 Salvage value now 9,000 - Salvage value eight years from now 1,000 4,000 If the company keeps and overhauls its present delivery truck, then the truck will be usable for eight more years. If a new truck is purchased, it will be used for eight years, after which it will be traded in on another truck. The new truck would be diesel operated, resulting in a substantial reduction in annual operating costs as shown above. The company computes depreciation on a straight-line basis. All investment projects are evaluated using a 16% discount rate. Present value of an ordinary annuity of P1 for 8 years is 4.344. Present value of 1 for 8 years is .305. Required: Using the NPV method in making decision, should the company keep or purchase the new truck?