The Taylor Company Limited reported a cost of goods sold of $1,324,660 last year, when 42,800 units were produced and sold. The cost of goods sold was 36% materials, 42% direct labour, and 22% overhead. The company is considering the purchase of a machine costing $353,100, with an expected useful life of five years and a salvage value at that time of $53,500. The machine would have a maximum capacity of 64,200 units per year and is expected to reduce direct labour costs by 30%; however, it would require an additional supervisor at a cost of $96,300 per year. The machine would be depreciated over the five years using the straight-line method. Production and sales for the next five years are expected to be as follows:

Year		Production and Sales
2020		42,800	units
2021		42,800	units
2022		47,080	units
2023		47,080	units
2024		47,080	units

Determine whether the company should purchase the machine if the company has a minimum desired rate of return of 12%. (If the net present value is negative, use either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). For calculation purposes, use 5 decimal places as displayed in the factor table provided, e.g. 1.25124 and final answer to 0 decimal places, e.g. 5,275.) Click here to view PV table.

Net present value

$

The company shouldshould not purchase the equipment.