a. A new operating system for an existing machine is expected to cost $710,000 and have a useful life of six years. The system yields an incremental after-tax income of $260,000 each year after deducting its straight-line depreciation. The predicted salvage value of the system is $22,800. b. A machine costs $590,000, has a $25,700 salvage value, is expected to last eight years, and will generate an after-tax income of $74,000 per year after straight-line depreciation. Assume the company requires a 12% rate of return on its investments. Compute the net present value of each potential investment. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Complete this question by entering your answers in the tabs below. Required A Required B A new operating system for an existing machine is expected to cost $710,000 and have a useful life of six years. The system yields an incremental after-tax income of $260,000 each year after deducting its straight-line depreciation. The predicted salvage value of the system is $22,800. (Round your answers to the nearest whole dollar.) Cash Flow Select Chart Amount PV Factor Present Value = Annual cash flow Future Value of 1 Residual value Future Value of an Annuity of 1 Immediate cash outflows Present value of cash inflows Net present value a. A new operating system for an existing machine is expected to cost $710,000 and have a useful life of six years. The system yields an incremental after-tax income of $260,000 each year after deducting its straight-line depreciation. The predicted salvage value of the system is $22,800. b. A machine costs $590,000, has a $25,700 salvage value, is expected to last eight years, and will generate an after-tax income of $74,000 per year after straight-line depreciation. Assume the company requires a 12% rate of return on its investments. Compute the net present value of each potential investment. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Complete this question by entering your answers in the tabs below. Required A Required B A machine costs $590,000, has a $25,700 salvage value, is expected to last eight years, and will generate an after-tax income of $74,000 per year after straight-line depreciation. (Round your answers to the nearest whole dollar.) Cash Flow Select Chart Amount PV Factor Present Value $ 0 0 Annual cash flow Present Value of 1 Residual value Future Value of 1 Present value of cash inflows Immediate cash outflows Net present value