Rust Industrial Systems is trying to decide between two different conveyor belt systems. System A costs $$216,000,$ has a four$-$year life, and requires $$69,000$ in pretax annual operating costs. System B costs $$306,000,$ has a six$-$year life, and requires $$63,000$ in pretax annual operating costs. Both systems are to be depreciated straight$-$line to zero over their lives and will have zero salvage value. Whichever system is chosen, it will not be replaced when it wears out. The tax rate is $21$ percent and the discount rate is $10$ percent. Calculate the NPV for both conveyor belt systems.

Which conveyor belt system should the firm choose

multiple choice

System A

System B