Weston Ltd. is considering investing in a new piece of equipment for its factory. the net cost of the machine is $250000. The accountants at Weston estimate that the machine will generate an additional $39800 per year in net operating income before taxes and that the equipment would have a salvage value (resale, residual) of $14000 at the end of 6 years. The company required rate of return is 12%

According to the present and future value tables, the present value of $1 for the required rate of return and the time period is 0.507 and the present value rate for an annuity is 4.111

Other than the initial purchase, assume all cash flows happen at the end of each period.

which value most closely represents the present value of the $14000 salvage value ??

1)$7098

2) $57544

3)$7098

4)$14000