X Exercise 20-29 (similar to) Active Mother manufactures baby furniture, clothing, strollers, and accessories. In the current year the company plans on purchasing a new machine to improve the quality and efficiency of production Active Mother has prepared estimates of future cash flows over the following four years, at which point it will sell the machine for $12,000. The company focuses on tax minimization and calculated depreciation over the four years using the straight-line method, a useful life of four years, and a residual value of SO (Click the icon to view the future cash flows.) (Click the icon to view the present value of $1 factors) (Click the icon to view the present value annuity of $1 factors.) Required Requirement 1. Calculate the net present value of the investment (Use factors to three decimal places. XXOX Use a minus sign or parentheses for a negative net present Value Round your final answer to the nearest whole dollar) The net present value of the investment is $ (116,313) Requirement 2. Should the company purchase the new machine? The company should not purchase the machine because the NPV is negative wie, VIVEM VI , SICUal Value UI JU. pon to view the future cash flows. Lor i Future cash flows WE 1. oral Relevant Cash Flows at End of Each year Today (224.000) ent va 2. Initial investment Annual cash flows from operations (excluding depreciation) Cash flow from sale of machine 25.000 25,000 25.000 25,000 12,000 y sho Required return on investment 10% Income tax rate 3596 Depreciation method CCA rate declining balance for income tax purposes ALL CF occur at end of year except for the initial investment Print [Done