discount rate is 9%

Exercise 24-4 |x Your answer is incorrect. Try again. BAK Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that it currently isn't equipped to do. Estimates regarding each machine are provided below. Machine A Machine B $78,300 8 years $185,000 8 years Original cost Estimated life Salvage value Estimated annual cash inflows Estimated annual cash outflows 0 $19,700 $5,040 $39,900 $9,850 Machine A Machine B x Net present value 5040 39900 Profitability index Which machine should be purchased? + Machine B should be purchased