KAM Corp is considering purchasing a diagnostic machine The machine would make it possible for the company to bid on jobs that it currently isnt equipped to do Estimates regarding the machine are provided below Machine Estimates Original Cost $188,000 Estimated Life 8 years Salvage Value $0 Estimated Annual Cash Inflows $40,200 Estimated Annual Cash Outflows $9,860 Calculate the net present value of the machine investment Assume a 9 discount rate

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Question: KAM Corp. is considering purchasing a diagnostic machine. The machine would make it possible for the company to bid on jobs that it currently isnt

KAM Corp. is considering purchasing a diagnostic machine. The machine would make it possible for the company to bid on jobs that it currently isnt equipped to do. Estimates regarding the machine are provided below.

	Machine Estimates
Original Cost	$188,000
Estimated Life	8 years
Salvage Value	$0
Estimated Annual Cash Inflows	$40,200
Estimated Annual Cash Outflows	$9,860

Calculate the net present value of the machine investment. Assume a 9% discount rate.

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