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Zenith Publishing Ltd is considering the purchase of a new printing machine which will allow them to print signage and posters. The company has conducted

Zenith Publishing Ltd is considering the purchase of a new printing machine which will allow them to print signage and posters. The company has conducted a feasibility costing $15,000 which indicated that there is unmet demand for signage and posters in the market. The machine will cost $390,000 and the company will need to spend another $10,000 to install the machine. The company will fully finance the purchase with a four year interest only loan from Commonwealth Bank that will charge a fixed interest rate of 7.98% per annum,with the principal repaid at the end of 4 vears.

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