The management of Kunkel Company is considering the purchase of a $22,000 machine that would reduce operating costs by $5,000 per year. At the end of the machine's five-year useful life, it will have zero scrap value. The company's required rate of return is 16% Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using table Required: 1. Determine the net present value of the investment in the machine. Net present value 2. What is the difference between the total, undiscounted cash inflows and cash outflows over the entire life of the machine? (Any cash outflows should be indicated by a minus sign.) Item Cash Flow Years Total Cash Flows Annual cost savings Initial investment Net cash flow Hints References eBook & Resources Hint #1 Check my work Perit Industries has $115.000 to invest. The company is trying to decide between two alternative uses of the funds. The alternatives are: Cost of equipment required Working capital investment required Annual cash inflows Salvage value of equipment in six years Life of the project Project A $115.000 $0 $21,000 $8,700 Project B $0 $115,000 $69,000 $0 6 years 6 years The working capital needed for project B will be released at the end of six years for investment elsewhere. Perit Industries' discount rate is 15%. Click here to view Exhibit 13B-1 tables Exhibit 13B-2. to determine the appropriate discount factor(s) using Required: a. Calculate net present value for each project. Project A Project B Net present value b. Which investment alternative (if either) would you recommend that the company accept? Project B Project A References eBook & Resources Expanded table Learning Objective: 13-01 Determine the payback period for an investment Difficulty: 1 Easy Learning Objective: 13-02 Evaluate the acceptability of an investment project using thentesentante