Masters Machine Shop is considering a four-year project to improve its production efficiency. Buying a new machine press for $758,400 is estimated to result in $252,800 in annual pretax cost savings. The press falls in the MACRS five-year class (MACRS Table), and it will have a salvage value at the end of the project of $110,600. The press also requires an initial investment in spare parts inventory of $31,600, along with an additional $4,740 in inventory for each succeeding year of the project.

If the shop's tax rate is 23 percent and its discount rate is 8 percent, what is the NPV for this project?

Multiple Choice

• $82,454.43

• $84,217.74

• $-12,749.47

• $86,577.15

• $78,331.70