The management of Kunkel Company is considering the purchase of a $40,000 machine that would reduce operating costs by $9,500 per year. At the end of the machines five-year useful life, it will have zero salvage value. The companys required rate of return is 13%.

Required:

1. Determine the net present value of the investment in the machine.

Determine the net present value of the investment in the machine. (Negative amounts should be indicated by a minus sign. Round your final answer to the nearest whole dollar amount. Use the appropriate table to determine the discount factor(s).

Net present value

$(7,150) selected answer incorrect