Dog Up! Franks is looking at a new sausage system with an installed cost of $670,800. This cost will be depreciated straight-line to zero over the project's 7-year life, at the end of which the sausage system can be scrapped for $103,200. The sausage system will save the firm $206,400 per year in pretax operating costs, and the system requires an initial investment in net working capital of $48,160.

If the tax rate is 22 percent and the discount rate is 11 percent, what is the NPV of this project?

Multiple Choice

• $162,206.44

• $211,026.91

• $187,169.77

• $225,941.34

• $200,978.01