Tulsa Company is considering investing in new bottling equipment and has two options: Option A has a lower initial cost but would require a significant expenditure to rebuild the machine after four years; Option B has higher maintenance costs, but also has a higher salvage value at the end of its useful life. Tulsas cost of capital is 11 percent. The following estimates of the cash flows were developed by Tulsas controller:

	A	B
Initial Investment	320,000	454,000
Annual Cash inflows	150,000	160,000
Annual cash outflows	70,000	75,000
Costs to rebuild	120,000	0
salvage value	0	24,000
estimated useful life	8yrs	8yrs

Required:

Calculate NPV. (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1.) (Use appropriate factor(s) from the tables provided. Negative amounts should be indicated by a minus sign. Round your "Present Values" to the nearest whole dollar amount.)

Option A
	Year	Cashflows	PV factor	present value
			11%
initial investment	0
annual cash flows	1-8
cost to rebuild	4
salvage	8
net present value
Option B
	Year	cashflows	PV Factor	Present value
			11%
initial investment	0
annual cash flows	1-8
cost to rebuild	4
salvage	8
net present value