Transcribed Image Text
Geary Machine Shop is considering a four-year project to improveits production efficiency. Buying a new machine press for $547,200is estimated to result in $182,400 in annual pretax cost savings.The press falls in the MACRS five-year class (MACRS Table), and itwill have a salvage value at the end of the project of $79,800. Thepress also requires an initial investment in spare parts inventoryof $22,800, along with an additional $3,420 in inventory for eachsucceeding year of the project. Required :If the shop's tax rate is 32 percent and its discount rate is 13percent, what is the NPV for this project? (Do not roundyour intermediate calculations.)Multiple Choice:$-26,483.98$-24,701.48$-84,615.53$-27,808.17$-25,159.78