MANAGERIAL ACCOUNTING QUIZ 8 Score LOCASCIO NameMADELYN Section Problem (10 points). Hopi Company is considering the possibility of replacing one of its current machines used in production with a new machine. The new machine has an estimated useful life of eight years. The company uses an 8 percent minimum desired rate of return in determining whether to accept capital investment projects. Below are the estimated net cash inflows from the machine (cash savings from using the new machine instead of the old machine). HOPI COMPANY NET CASH INFLOWS FOR CAPITAL BUDGETING ANALYSIS Year Net Cash Inflows 1 S 2 170,000 155,000 150,000 100,000 5 100,000 7 8 100,000 95,000 90,000 The salvage value of the machine is expected to be $20,000 in Year 8. The cost of the new machine is $750,000 REQUIRED: (1) Compute the net present value of the machine. Round your answer to the nearest whole dollar. Should the company purchase the new machine? Explain. (2)