mputing net present value LO P3 B2B Co. is considering the purchase of equipment that would allow the company to add a new product to its line. The equipment is expected to cost $360,000 with a 12-year life and no salvage value. It will be depreciated on a straight-line basis. The company expects to sell 144,000 units of the equipment's product each year. The expected annual income related to this equipment follows. Sales Costs Materials, labor, and overhead (except depreciation on new equipment) Depreciation on new equipment Selling and administrative expenses Total costs and expenses Pretax income Income taxes (30%) Net income $225,000 120,000 30,000 22,500 172,500 52,500 15,750 $ 36,750 If at least an 8% return on this investment must be earned, compute the net present value of this investment. (PV of $1, EV of $1, PVA of $1, and EVA of $1) (Use appropriate factor(s) from the tables provided.) If at least an 8% return on this investment must be earned, compute the net present value of this investment. (PV a $1, PVA of $1, and EVA of $1) (Use appropriate factor(s) from the tables provided.) Answer is complete but not entirely correct. Chart Values are Based on: Select Chart n = = % PV Present Amount Factor Value 96,520 x 5.7466 554,662 Present Value of an Annuity of 1 Present value of cash inflows Present value of cash outflows Net present value $ 554,662 377,600 $ 177,066