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Blossom inc manufactures snowsuits. Blossom is considering purchasing a new sewing machine at a cost of $2.45 million. Its existing machine was purchased 5 years

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Blossom inc manufactures snowsuits. Blossom is considering purchasing a new sewing machine at a cost of $2.45 million. Its existing machine was purchased 5 years ago at a price of $18 million; six months ago, Blossom spent $55,000 to loep it operational. The existing sewing machine can be sold today for $243,255. The new sewing machine would require a one-time, $85,000 training cost. Operating costs would decrease by the following amounts for years 1 to 7 . The new sewing machine would be depreciated according to the declining balance method at a rate of 209 . The salvage value is expected to be $379.700. This new equipment would require maintenance costs of $98.400 at the end of the fifth vear, The cost of capitalis 99 . Clickhere to vew the factor table Use the net oresent value method to determine the following (If net present value is negotive then enter with negative sian preceding the number es.-45 or porentheses es 145) Round present value answer to 0 decimal ploces, es. 125. For calculation purposes, use 5 decimal places os displored in the foctor table provided) Calculate the net present value The new sewing machine would be depreciated according to the declining-balance method at a rate of 20%. The salvage value is expected to be $379,700. This new equipment would require maintenance costs of $98,400 at the end of the fifth year. The cost of capital is 9%. Click here to view the factor table. Use the net present value method to determine the following: If net present value is negotive then enter with negative sign preceding the number es -45 or parentheses eg. (45). Round present value answer to 0 decimal ploces, eg. 125 . For calculation purposes, use 5 decimal places as displayed in the factor table provided) Calculate the net present value. Net presentvalue Determine whether Blossom should purchase the new machine to replace the existing machine

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