Tabletop Ranches, Inc. is considering the purchase of a

new helicopter for $325,000. The firm's old helicopter has

a book value of

$85,000, but can only be sold for $60,000.

The new helicopter will be subject to 25% CCA. It is

expected to save $62,000 for 7 years before taxes, through

reduced fuel and maintenance expenses. Tabletop Ranch

is in the 40% tax bracket and has a 12% cost of capital.

Calculate the net present value of the helicopter purchase

and state whether or not the firm should buy it