Question: please workout and show formuls and solutions in excel spreadsheet! 108.13 You are interested in purchasing a machine that will save $200,000 per year be-
108.13 You are interested in purchasing a machine that will save $200,000 per year be- fore taxes. The cost of operating the machine, including maintenance, is $80,000 per year. The machine, which costs $150,000, will be needed for five years after which it will have a salvage valuc of $25,000. The machine would qualify for a year MACRS property. What is the net present value of the cash flows gener- ated fixom this machine at 15%? The firm's income tax rate is 40%. (a) $123,554 (b) $137,883 (c) $131,852 (d) $122,438
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