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Haworth Company is considering the purchase of a labor-saving piece of equipment with the following information: Purchase cost of equipment $432,000 Annual cost savings $90,000

Haworth Company is considering the purchase of a labor-saving piece of equipment with the following information:

Purchase cost of equipment $432,000

Annual cost savings $90,000

Terminal salvage value 0

Useful life of equipment 12 years

Required rate of return 10%

What is the net present value of the equipment? Should Haworth purchase the quipment?

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