E11-11 (Static) Using NPV to Evaluate Mutually Exclusive Projects [LO 11-5) Tulsa Company is considering investing in new bottling equipment and has two options: Option A has a lower initial cost but would require a significant expenditure to rebuild the machine after four years: Option B has higher maintenance costs, but also has a higher salvage value at the end of its useful life. Tulsa's cost of capital is 11 percent. The following estimates of the cash flows were developed by Tulsa's controller Option A $ 320,000 158,089 70,000 120,000 Option B $ 454.000 160,000 75,000 Initial investment Annual cash inflows Annual cash outflows Costs to rebuild Salvage value Estimated useful life 24,00 Required: Calculate NPV. (Euture Value of $1. Present Value of $1. Evture Value Annuity of S1, Present Value Annuity of $1. (Use appropriate factor(s) from the tables provided. Negative amounts should be indicated by a minus sign. Round your "Present Values" to the nearest whole dollar amount.) Ootion Year Cash Flows PV factor Present Value 0 Intalinvestment Annual Cash Flows Cost to Rebuild Required: Calculate NPV. (Future Value of $1. Present Value of $1. Future Value Annuity of $1. Present Value Annuity of $1.) factor(s) from the tables provided. Negative amounts should be indicated by a minus sign. Round your "Pres nearest whole dollar amount.) Option A Year Cash Flows PV factor Present Value O2 Initial Investment Annual Cash Flows Cost to Rebuild Salvage Net Present Value Option B Cash Flows PV factor Present Value Initial investment Annual Cash Flows Cost to Rebuild Salvage Net Present Value K #2 A 11% Initial Investment Annual Cash Flows Cost to Rebuild Salvage Net Present Value 00 Option B Year Cash Flows PV factor Present Value Initial Investment Annual Cash Flows Cost to Rebuild Salvage Net Present Value Determine which option Tulsa should select? Option A Option B