Jesse Company has obtained the following data about a possible planned investment:

Cost $300,000

Terminal salvage value in 10 years 0

Additional annual revenues for 10 years $250,000

Additional annual cash expenses for 10 years $200,000

Estimated useful life in years 10

Minimum desired rate of return 10%

Present value of ordinary annuity, 10%, 10 periods 6.1446

Present value of one, 10%, 10 periods 0.3855

Income tax rate 40%

The company uses the straight-line depreciation method for taxes.

Required:

A) Compute the net present value of the investment.

B) Compute the net present value of the investment if the terminal salvage value is estimated to be $50,000 in 10 years.