The Canada Bottling Co. is considering the purchase of a new machine that would increase the speed of bottling and save money. The net cost of this machine is $60,000. The annual cash flows have the following projections:

Year Cash Flow

1 ..................... $23,000

2 ..................... 26,000

3 ..................... 29,000

4 ..................... 15,000

5 ..................... 8,000

a. If the cost of capital is 13 percent, what is the net present value of selecting a new machine?

b. What is the internal rate of return?

c. Should the project be accepted? Why?

Include financial calculator steps, including the keys pressed on the calculator to solve each step.