The Hess Environmental Center has a seven year contract with the power to reduce the level of pollutants in the Huren her. The following terms are associated with the wors needed for this contract Cost of special equipment needed noe Initial supply of lubricants Net annual operating cash flows Salage value of the equipment in seven years $500,000 90.000 150,000 25,000 The special equipment in the five year property class. The tax rate is 30% for ordinary income and 15% for capital gains. Hess's after tax cost of capital is 16% The present value of the after tax salvage received on sale of the equipment at the end of seven years is 57.519 56.192 $1327 AS 846