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TLC Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that

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TLC Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that it currently is not equipped to do. Estimates for each machine are as follows: Machine A Machine B Original cost $78,500 $190,000 Estimated life 8 years 8 years Salvage value 0 0 Estimated annual cash inflows $22,200 $39,500 Estimated annual cash outflows $4,800 $9.100 Click here to view PV table. Click here to view PV table. Calculate the net present value and profitability index of each machine. Assume a 10% discount rate. (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 answers to O decimal places, e.g. 5,275. Round profitability index answers to 3 decimal places, e.g. 12.521.) Machine A Machine B Net present value $ 11760 -23317 Profitability index 1.15 0.877 Which machine should be purchased? Machine B

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