HI Corporation is considering the purchase of a machine that promises to reduce operating costs by the
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Question:
HI Corporation is considering the purchase of a machine that promises to reduce operating costs by the same amount for every year of its 7-year useful life. The machine will cost $210,380 and has no salvage value. The machine has a 14% internal rate of return. (Ignore income taxes.) Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s) using the tables provided. Required: What are the annual cost savings promised by the machine? (Round your intermediate calculations and final answer to the nearest whole dollar amount.)
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