Grady Corporation is considering the purchase of a new piece of equipment. The equipment costs $$50,700$ and will have a salvage value of $$5,050$ after $6$ years. Using the new piece of equipment will increase Grady's annual net cash flows by $$6,100.$ Grady's cost o capital is $15\%.($Future Value of $$1,$ Present Value of $$1,$ Future Value Annuity of $$1,$ Present Value Annuity of $$1)$

Note: Use appropriate factor from the PV tables.

Required:

o$.$ What is the present value of the increase in annual cash flows?

b$.$ What is the present value of the salvage value?

c$.$ What is the net present value of the equipment purchase?

d$.$ Based on financial factors, should Grady purchase the equipment?

Complete this question by entering your answers in the tabs below.

Required $A$

Required B

Required C

What is the present value of the increase in annual cash flows?

Note: Round your answer to the nearest whole dollar.

Present Value