Candy Company is considering purchasing a second chocolate dipping machine in order to expand their business. The informationAmazinghas accumulated regarding the new machine is:

Cost of the machine	$ 100,000
Increased contribution margin	$ 20,000
Life of the machine	9 years
Required rate of return	10%

Amazing estimates they will be able to produce more candy using the second machine and thus increase their annual contribution margin. They also estimate there will be a small disposal value of the machine but the cost of removal will offset that value. Ignore income tax issues in your answers. Assume all cash flows occur at year-end except for initial investment amounts.

Requirement 1.Calculate the following for the new machine:

a. Net present value (NPV)(Use factors to three decimal places, X.XXX, and use a minus sign or parentheses for a negative net present value. Enter the net present value of the investment rounded to the nearest whole dollar.)

The net present value is

$ 15,180

.

b.Payback period(Round your answer to two decimal places.)

The payback period in years is

5.00

.

c. Discounted payback period(Round interim calculations to the nearest whole dollar. Round the rate to two decimal places, X.XX%.)

The discounted payback period in years is

.