A company is considering two mutually exclusive methods of producing a new product. The relevant data concerning the alternatives appear below. At the end of the useful life of whatever equipment is chosen the product will be discontinued. The company's tax rate is 50 percent and the discount rate is 10 percent.

Calculate the net present value of each alternative. Please provide how you get the answer. What makes up the answer for each alternative?

	Alternative 1	Alternative 2		Other assumptions
Initial investment	$55,000	$120,000		Tax rate	50%
Annual receipts	$50,000	$60,000		Discount rate	10%
Annual disbursements	$20,000	$12,000
Annual depreciation	$16,000	$20,000
Expected life (years)	4	6
Salvage value	$0	$0