Esquire Company needs to acquire a molding machine to be used in its manufacturing process. Two types of machines that would be appropriate are presently on the market. The company has determined the following: (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Machine A could be purchased for $21,000. It will last 10 years with annual maintenance costs of $700 per year. After 10 years the machine can be sold for $2,205. Machine B could be purchased for $17,500. It also will last 10 years and will require maintenance costs of $2,800 in year three, $3,500 in year six, and $4,200 in year eight. After 10 years, the machine will have no salvage value. Required: Assume an interest rate of 8% properly reflects the time value of money in this situation and that maintenance costs are paid at the end of each year. Ignore income tax considerations. Calculate the present value of Machine A & Machine B. Which machine Esquire should purchase? (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations. Round your final answers to nearest whole dollar amount.) PV Machine A Machine B Esquire should purchase Machine B TABLE 4 Present Value of an ordinary Annuity of $1 1- (1+1) PVA = w 1 2 3 4 5 1.0% 1.5% 0.99010 0.98522 1.97040 1.95588 2.940992.91220 3.90197 3.85438 4.853434.78264 2.0% 0.98039 1.94156 2.88388 3.80773 4.71346 2.5% 0.97561 1.92742 2.85602 3.76197 4.64583 3.0% 0.97087 1.91347 2.82861 3.71710 4.57971 3.5% 4.0% 4.5% 5.0% 0.96618 0.96154 0.95694 0.95238 1.899691.886091.87267 1.85941 2.80164 2.77509 2.74896 2.72325 3.67308 3.62990 3.58753 3.54595 4.51505 4.45182 4.389984.32948 5.5% 0.94787 1.84632 2.69793 3.50515 4.27028 6.0% 7.0% 0.94340 0.93458 1.83339 1.80802 2.67301 2.62432 3.465113.38721 4.21236 4.10020 5.0% 0.92593 1.78326 2.57710 3.31213 3.99271 0.0% 0.0% 11.0% 12.0% 0.91743 0.90909 0.90090 0.89286 1.75911 1.73554 1.71252 1.69005 2.53129 2.48685 2.44371 2.40183 3.239723.16987 3.10245 3.03735 3.88965 3.79079 3.69590 3.60478 20.0% 0.83333 1.52778 2.10648 2.58873 2.99061 7 5.79548 5.69719 6.72819 6.59821 7.651687.48593 8.56602 8.36052 5.60143 6.47199 7.32548 8.16224 5.50813 5.41719 5.32855 5.24214 6.349396.23028 6.11454 6.00205 7.170147.019696.87396 6.73274 7.970877.78611 7.607697.43533 5.15787 5.07569 5.89270 5.78637 6.595896.46321 7.268797.10782 4.99553 4.91732 4.76654 4.62288 5.68297 5.58238 5.389295.20637 6.33457 6.209795.97130 5.74664 6.952206.80169 6.515236.24689 4.48592 4.35526 4.23054 4.11141 3.32551 5.03295 4.86842 4.71220 4.56376 3.60459 5.53482 5.33493 5.146124.96764 3.83716 5.99525 5.759025 .53705 5.32825 4.03097 8 9 9.47130 9.22218 8.98259 8.75206 8.53020 8.31661 8.11090 7.91272 7.721737.537637.36009 7.02358 6.71008 6.41766 6.14457 5.88923 5.65022 4.19247 11 10.36763 12 11.25508 13 12.13374 14 13.00370 15 13.86505 10.07112 10.90751 11.73153 12.54338 13.34323 9.78685 10.57534 11.34837 12.10625 12.84926 9.51421 9.252629.00155 10.25776 9.95400 9.66333 10.98319 10.63496 10.30274 11.69091 11.29607 10.92052 12.38138 11.93794 11.51741 8.76048 9.38507 9.98565 10.56312 11.11839 8.52892 9.11858 9.68285 10.22283 10.73955 8.30641 8.86325 9.39357 9.89864 10.37966 8.09254 7.886877.49867 8.618528.38384 7.94269 9.11708 8.85268 8.35765 9.58965 9.29498 8.74547 10.03758 9.71225 9.10791 7.13896 7.53608 7.90378 8.24424 8.55948 6.80519 6.49506 6.20652 5.93770 4.32706 7.16073 6.81369 6.49236 6.19437 4.43922 7.48690 7.10336 6.74987 6.42355 4.53268 7.78615 7.36669 6.98187 6.62817 4.61057 8.060697.60608 7.19087 6.81086 4.67547 16 17 18 19 20 14.71787 15.56225 16.39827 17.22601 18.04555 14.13126 13.57771 14.90765 14.29187 15.67256 14.99203 16.42617 15.67846 17.16864 16.35143 13.05500 13.71220 14.35336 14.97889 15.58916 12.56110 12.09412 13.16612 12.65132 13.75351 13.18968 14.32380 13.70984 14.87747 14.21240 11.65230 12.16567 12.65930 13.13394 13.59033 11.23402 11.70719 12.15999 12.59329 13.00794 10.83777 11.27407 11.68959 12.08532 12.46221 10.46216 10.86461 11.24607 11.60765 11.95038 10.10590 10.47726 10.82760 11.15812 11.46992 9.446658.85137 8.31256 7.82371 7.37916 6.97399 4.72956 9.76322 9.12164 8.54363 8.02155 7.54879 7.11963 4.77463 10.059099.371898.75563 8.20141 7.701627.24967 4.81219 10.33560 9.60360 8.95011 8.36492 7.839297.36578 4.84350 10.59401 9.81815 9.12855 8.51356 7.96333 7.46944 4.86958 21 18.85698 17.90014 17.01121 25 22.02316 20.71961 19.52346 30 25.80771 24.01584 22 39646 40 32.83469 29.91585 27.35548 16.18455 18.42438 20.93029 25.10278 15.41502 14.69797 17.41315 16.48151 19.60044 18.39205 23.11477 21.35507 14.02916 13.40472 12.82115 15.62208 14.82821 14.09394 17.29203 16.28889 15.37245 19.79277 18.40158 17.15909 12.27524 13.41393 14.53375 16.04612 11.76408 12.78336 13.76483 15.04630 10.83553 11.65358 12.40904 13.33171 10.01680 10.67478 11.25778 11.92461 9.29224 8.64869 8.07507 7.56200 4.89132 9.82258 9.07704 8.42174 7.84314 4.94759 10.27365 9.42691 8.693798.05518 4.97894 10.75736 9.77905 8.95105 8.24378 4.99660 TABLE 2 Present Value of $1 $1 PV (1+i)" ni 1.0% 1 0.99010 2 0.98030 3 0.97059 4 0.96098 5 0.95147 1.5% 0.98522 0.97066 0.95632 0.94218 0.92826 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% 0.98039 0.97561 0.97087 0.96618 0.96154 0.95694 0.96117 0.95181 0.94260 0.93351 0.92456 0.91573 0.94232 0.92860 0.91514 0.90194 0.88900 0.87630 0.92385 0.90595 0.88849 0.87144 0.85480 0.83856 0.90573 0.88385 0.86261 0.84197 0.82193 0.80245 5.0% 5.5% 6.0% 7.0% 0.95238 0.94787 0.94340 0.93458 0.90703 0.89845 0.89000 0.87344 0.86384 0.85161 0.83962 0.81630 0.82270 0.80722 0.79209 0.76290 0.78353 0.76513 0.74726 0.71299 8.0% 0.0% 0.0% 0.92593 0.91743 0.90909 0.85734 0.84168 0.82645 0.79383 0.77218 0.75131 0.73503 0.70843 0.68301 0.68058 0.64993 0.62092 11.0% 12.0% 20.0% 0.90090 0.89286 0.83333 0.81162 0.79719 0.69444 0.73119 0.71178 0.57870 0.65873 0.63552 0.48225 0.59345 0.56743 0.40188 6 7 8 9 10 0.94205 0.91454 0.88797 0.86230 0.83748 0.81350 0.79031 0.76790 0.74622 0.72525 0.70496 0.66634 0.63017 0.59627 0.56447 0.53464 0.50663 0.33490 0.93272 0.90103 0.87056 0.84127 0.81309 0.78599 0.75992 0.73483 0.71068 0.68744 0.66506 0.62275 0.58349 0.54703 0.51316 0.48166 0.45235 0.27908 0.92348 0.88771 0.85349 0.82075 0.78941 0.75941 0.73069 0.70319 0.67684 0.65160 0.62741 0.58201 0.54027 0.50187 0.46651 0.43393 0.40388 0.23257 0.91434 0.87459 0.83676 0.80073 0.76642 0.73373 0.70259 0.67290 0.64461 0.61763 0.59190 0.54393 0.50025 0.46043 0.42410 0.39092 0.36061 0.19381 0.90529 0.86167 0.82035 0.78120 0.74409 0.70892 0.67556 0.64393 0.61391 0.58543 0.55839 0.50835 0.46319 0.42241 0.38554 0.35218 0.32197 0.16151 11 0.89632 0.84893 0.80426 0.76214 0.72242 0.68495 0.64958 0.61620 0.58468 0.55491 0.52679 0.47509 0.42888 0.38753 0.35049 0.31728 0.28748 0.13459 12 0.88745 0.83639 0.78849 0.74356 0.70138 0.66178 0.62460 0.58966 0.55684 0.52598 0.49697 0.44401 0.39711 0.35553 0.31863 0.28584 0.25668 0.11216 13 0.87866 0.82403 0.77303 0.72542 0.68095 0.63940 0.60057 0.56427 0.53032 0.49856 0.46884 0.41496 0.36770 0.32618 0.28966 0.25751 0.22917 0.09346 14 0.86996 0.81185 0.75788 0.70773 0.66112 0.61778 0.57748 0.53997 0.50507 0.47257 0.44230 0.38782 0.34046 0.29925 0.26333 0.23199 0.20462 0.07789 15 0.86135 0.79985 0.74301 0.69047 0.64186 0.59689 0.55526 0.51672 0.48102 0.44793 0.41727 0.36245 0.31524 0.27454 0.23939 0.20900 0.18270 0.06491 16 0.85282 0.78803 0.72845 0.67362 0.62317 0.57671 0.53391 0.49447 0.45811 0.42458 0.39365 0.33873 0.29189 0.25187 0.21763 0.18829 0.16312 0.05409 17 0.84438 0.77639 0.71416 0.65720 0.60502 0.55720 0.51337 0.47318 0.43630 0.40245 0.37136 0.31657 0.27027 0.23107 0.19784 0.16963 0.14564 0.04507 18 0.83602 0.76491 0.70016 0.64117 0.58739 0.53836 0.49363 0.45280 0.41552 0.38147 0.35034 0.29586 0.25025 0.21199 0.17986 0.15282 0.13004 0.03756 19 0.82774 0.75361 0.68643 0.62553 0.57029 0.52016 0.47464 0.43330 0.39573 0.36158 0.33051 0.27651 0.23171 0.19449 0.16351 0.13768 0.11611 0.03130 20 0.81954 0.74247 0.67297 0.61027 0.55368 0.50257 0.45639 0.41464 0.37689 0.34273 0.31180 0.25842 0.21455 0.17843 0.14864 0.12403 0.10367 0.02608 21 0.81143 24 0.78757 25 0.77977 28 0.75684 29 0.74934 0.73150 0.65978 0.59539 0.53755 0.69954 0.62172 0.55288 0.49193 0.68921 0.609530.53939 0.47761 0.65910 0.57437 0.50088 0.43708 0.64936 0.56311 0.48866 0.42435 0.48557 0.43883 0.43796 0.39012 0.42315 0.37512 0.38165 0.33348 0.36875 0.32065 0.39679 0.34770 0.33273 0.29157 0.27902 0.35894 0.31007 0.29530 0.25509 0.24295 0.32486 0.29416 0.24151 0.27666 0.24698 0.19715 0.26223 0.23300 0.18425 0.22332 0.19563 0.15040 0.21168 0.18456 0.14056 0.19866 0.16370 0.13513 0.15770 0.12640 0.10153 0.14602 0.11597 0.09230 0.11591 0.08955 0.06934 0.10733 0.08215 0.06304 0.11174 0.09256 0.02174 0.08170 0.06588 0.01258 0.07361 0.05882 0.01048 0.05382 0.04187 0.00607 0.04849 0.03738 0.00506 30 0.74192 0.63976 0.55207 0.47674 0.41199 0.35628 0.30832 0.267000.23138 0.20064 0.17411 0.13137 0.09938 0.07537 0.05731 0.04368 0.03338 0.00421 31 0.73458 0.63031 0.54125 0.46511 0.39999 0.34423 0.29646 0.25550 0.22036 0.19018 0.16425 0.12277 0.09202 0.06915 0.05210 0.03935 0.02980 0.00351 40 0.67165 0.55126 0.45289 0.37243 0.30656 0.25257 0.20829 0.17193 0.14205 0.11746 0.09722 0.06678 0.04603 0.03184 0.02209 0.01538 0.01075 0.00068