Union Bay Plastics is investigating the purchase of automated equipment that would save $110,000 each year in direct labor and inventory carrying costs. This equipment costs $820,000 and is expected to have a 7-year useful life with no salvage value. The companys required rate of return is 7% on all equipment purchases. This equipment would provide intangible benefits such as greater flexibility and higher-quality output that are difficult to estimate and yet are quite significant. (Ignore income taxes.)

Click here to view Exhibit 8B-1 and Exhibit 8B-2, to determine the appropriate discount factor(s) using table.

Required:

What dollar value per year would the intangible benefits have to have in order to make the equipment an acceptable investment? (Round discount factor to 3 decimal places.)