Oldham industries is considering replacing a five year old machine with an original life of 10 years, a cost of $100,000, and a zero salvage value, with a new more efficient machine. The new machine will cost $200,000 installed and will have a 10 year life. The new machine will increase sales by $55000 and decrease scrap cost by $10,000 per year. The old machine can be sold currently for $50,000. Assume straight line depreciation. What is the net present value of this replacement, given 12 percent cost of capital?

select the correct answer

-$9865.5

$90134.5

-$59865.5

-$19865.5

$33632.25

$40134.5