EIF Manufacturing Company needs to overhaul its drill press or buy a new one. The facts have been gathered, and they are as follows:

	Current Machine	New Machine
Purchase Price, New	$88,000	$110,000
Current book value	33,000
Overhaul needed now	44,000
Annual cash operating costs	77,000	44,000
Current salvage value	22,000
Salvage value in five years	5,500	22,000

Required:

Calculate the NPV of both keeping the current drill press and buying a new one. Which alternative is the most desirable with a current required rate of return of 20%? Show computations, and assume no taxes.

EIF Manufacturing Company needs to overhaul its drill press or buy a new one. The facts have been gathered, and they are as follows:

	Current Machine	New Machine
Purchase Price, New	$88,000	$110,000
Current book value	33,000
Overhaul needed now	44,000
Annual cash operating costs	77,000	44,000
Current salvage value	22,000
Salvage value in five years	5,500	22,000

Required:

Calculate the NPV of both keeping the current drill press and buying a new one. Which alternative is the most desirable with a current required rate of return of 20%? Show computations, and assume no taxes.

EIF Manufacturing Company needs to overhaul its drill press or buy a new one. The facts have been gathered, and they are as follows:

	Current Machine	New Machine
Purchase Price, New	$88,000	$110,000
Current book value	33,000
Overhaul needed now	44,000
Annual cash operating costs	77,000	44,000
Current salvage value	22,000
Salvage value in five years	5,500	22,000

Required:

Calculate the NPV of both keeping the current drill press and buying a new one. Which alternative is the most desirable with a current required rate of return of 20%? Show computations, and assume no taxes.

EIF Manufacturing Company needs to overhaul its drill press or buy a new one. The facts have been gathered, and they are as follows:

	Current Machine	New Machine
Purchase Price, New	$88,000	$110,000
Current book value	33,000
Overhaul needed now	44,000
Annual cash operating costs	77,000	44,000
Current salvage value	22,000
Salvage value in five years	5,500	22,000

Required:

Calculate the NPV of both keeping the current drill press and buying a new one. Which alternative is the most desirable with a current required rate of return of 20%? Show computations, and assume no taxes.

EIF Manufacturing Company needs to overhaul its drill press or buy a new one. The facts have been gathered, and they are as follows:

	Current Machine	New Machine
Purchase Price, New	$88,000	$110,000
Current book value	33,000
Overhaul needed now	44,000
Annual cash operating costs	77,000	44,000
Current salvage value	22,000
Salvage value in five years	5,500	22,000

Required:

Calculate the NPV of both keeping the current drill press and buying a new one. Which alternative is the most desirable with a current required rate of return of 20%? Show computations, and assume no taxes.

EIF Manufacturing Company needs to overhaul its drill press or buy a new one. The facts have been gathered, and they are as follows:

	Current Machine	New Machine
Purchase Price, New	$88,000	$110,000
Current book value	33,000
Overhaul needed now	44,000
Annual cash operating costs	77,000	44,000
Current salvage value	22,000
Salvage value in five years	5,500	22,000

Required:

EIF Manufacturing Company needs to overhaul its drill press or buy a new one. The facts have been gathered, and they are as follows:

	Current Machine	New Machine
Purchase Price, New	$88,000	$110,000
Current book value	33,000
Overhaul needed now	44,000
Annual cash operating costs	77,000	44,000
Current salvage value	22,000
Salvage value in five years	5,500	22,000

Required:

Calculate the NPV of both keeping the current drill press and buying a new one. Which alternative is the most desirable with a current required rate of return of 20%? Show computations, and assume no taxes.