The management of Polymer Corporation, a plastics manufacturer, is considering the purchase of machinery that would cost $2,400,000 and have no salvage value at the end of its 5 year useful life. The company estimates the following annual net operating income;

Revenues $3,200,000

Variable Expenses $1,800,000

Contribution Margin $1,400,000

Fixed Expenses:

Depreciation $300,000

Insurance $100,000

Salary $600,000

Total Fixed Expenses $1,000,000

Net Operating Income $400,000

ABC Corporation requires a 12% return.

What is the net present value of the contract? Is the project acceptable?