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XYZ Company is considering the purchase of a new machine. The machine will cost $215,000 and is expected to last 10 years. However, the machine

XYZ Company is considering the purchase of a new machine. The machine will cost $215,000 and is expected to last 10 years. However, the machine will need maintenance costing $25,000 at the end of year three and at the end of year six. In addition, purchasing this machine would require an immediate investment of $35,000 in working capital which would be released for investment elsewhere at the end of the 10 years. The machine is expected to have a $15,000 salvage value at the end of 10 years. The machine will be used to generate net cash inflows of $49,000 per year in each of the 10 years. XYZ Company has a cost of capital of 8% and an income tax rate of 40%. Calculate the net present value (NPV) of this machine. If your answer is negative, place a minus sign in front of your answer with no spaces in between (e.g., -1234).

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