Snowy Mountain Timber Ltd is considering purchasing a new woodsaw that costs $70,000. The saw will generate revenues of $100,000per year for five years. The cost of materials and labour needed togenerate these revenues will total $60,000 per year, and other cashexpenses will be $10,000 per year. The machine is expected to sellfor $3,500 at the end of its five-year life and will be depreciatedon a straight-line basis over five years to zero. Snowy Mountain’stax rate is 34 percent, and its opportunity cost of capital is10.70 percent. The project's NPV is $ .
The project should be (accept or rejected?).
(Round your intermediate calculations to three decimal placesand round each of your final answers to the nearest dollar. Useparenthesis to enter negative amounts.)
