Question: Carson Electronics is currently considering whether to acquire a new materials - handling machine for its manufacturing operations. The machine costs $ 7 6 0

Carson Electronics is currently considering whether to acquire a new materials-handling machine for its manufacturing operations. The machine costs $760,000 and will be depreciated using straight-line depreciation toward a zero-salvage value over the next six years. During the life of the machine, no new capital expenditures, or investments in working capital will be required. The new materials-handling machine is expected to save Carson Electronics $250,000 per year before taxes of 30%. Carsons CFO recently analysed the firms opportunity cost of capital and estimated it to be 9%.
What is the net operating profit after tax (NOPAT) for the project in year 2?
A.
$68,600
B.
$86,333
C.
$87,333
D.
$88,600

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