(Ignore income taxes in this problem.) The management of Mashiah Corporation is considering the purchase of a machine that would cost $300,000, would last for 5 years, and would have no salvage value. The machine would reduce labor and other costs by $104,000 per year. The company requires a minimum pretax return of 6% on all investment projects.

The present value of the annual cost savings of $104,000 is closest to:

a. $879,264

b. $438,048

c. $226,124

d. $520,000