Cullumber's Auto Care is considering the purchase of a new tow truck. The garage doesn't currently have a tow truck, and the $60,030 price tag for a new truck would represent a major expenditure. Cullumber Austen, owner of the garage, has compiled the following estimates in trying to determine whether the tow truck should be purchased. Initial cost $60,030 Estimated useful life 8 years Net annual cash flows from towing $8,050 Overhaul costs (end of year 4) $5,960 Salvage value $11.990 Cullumber's good friend, Rick Ryan, stopped by. He is trying to convince Cullumber that the tow truck will have other benefits that Cullumber hasn't even considered. First, he says, cars that need towing need to be fixed. Thus, when Cullumber tows them to her facility, her repair revenues will increase. Second, he notes that the tow truck could have a plow mounted on it, thus saving Cullumber the cost of plowing her parking lot. (Rick will give her a used plow blade for free if Cullumber will plow Rick's driveway.) Third, he notes that the truck will generate goodwill; people who are rescued by Cullumber's tow truck will feel grateful and might be more inclined to use her service station in the future or buy gas there. Fourth, the tow truck will have "Cullumber's Auto Care" on its doors, hood, and back tailgate-a form of free advertising wherever the tow truck goes. Rick estimates that, at a minimum, these benefits would be worth the following. Additional annual net cash flows from repair work $3,000 Annual savings from plowing 760 Additional annual net cash flows from customer "goodwill" 980 Additional annual net cash flows resulting from free advertising 760 The company's cost of capital is 9%. Calculate the net present value, ignoring the additional benefits described by Rick. (If the net present value is negative, use either a negative sign preceding the number e.g.-45 or parentheses e.g. (45). Round answer to 0 decimal places, e.g. 125. For calculation purposes, use 5 decimal places as displayed in the factor table provided.) Net present value $ -13679.52 Should the tow truck be purchased? The tow truck should not be purchased. e Textbook and Media Attempts: 2 of 5 used (b) Calculate the net present value, incorporating the additional benefits suggested by Rick. (If the net present value is negative, use either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). Round answer to 0 decimal places, e.g. 125. For calculation purposes, use 5 decimal places as displayed in the factor table provided.) Net present value $ Should the tow truck be purchased? The tow truck 4 be purchased