The Claussens are considering the purchase of a hardware store. The Claussens anticipate that the store will generate cash flows of $84,000 per year for 20 years. At the end of 20 years, they intend to sell the store for an estimated $540,000. The Claussens will finance the investment with a variable rate mortgage. Interest rates will increase twice during the 20-year life of the mortgage. Accordingly, the Claussens desired rate of return on this investment varies as follows:

Years 15	6%
Years 610	8%
Years 1120	10%

Required:

What is the maximum amount the Claussens should pay for the hardware store? (Assume that all cash flows occur at the end of the year.)

Note: Do not round intermediate calculations. Round your final answers to nearest whole dollar amount. Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1)

	PV 0f 84,000 cashflow	+	PV of 540,000 selling price	=	Maximum paid for store
years 1-5	353832
years 6-10
years 11-20
year 20
total