Exercise 24-6 Net present value LO P3 a. A new operating system for an existing machine is expected to cost $580.000 and have seful life of six years. The system yields an incremental after-tax income of $170.000 each year after deducting its straight-line depreciation. The predicted salvage value of the system is $21.400. b. A machine costs $430,000, has a $30,500 salvage value, is expected to last eight years, and will generate an after-tax income of $62,000 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 $580,000 and have a useful life of six years. The system yields an incremental after-tax income of $170,000 each year after deducting its straight line depreciation. The predicted salvage value of the system is $21,400. (Round your answers to the nearest whole dollar.) Amount * PV Factor- Present Value Cash Flow S elect Chart Annual cash flow Residual value Net present ako Required B Complete this question by entering your answers in the tabs below. Required A Required A machine costs $430,000, has a $30,500 salvage value, is expected to last eight years, and will generate an after-tax Income of $62,000 per year after straight-line depreciation. (Round your answers to the nearest whole dollar) Cash Flow Select Chart Amount * PV Factor Present Value Annual cash flow Net present value