Techno Labs, a nonprofit organization, estimates that it can save $$25,000$ a year in cash operating costs for the next $8$ years if it buys a special$-$purpose eye$-$testing machine at a cost of $$120,000.$ No terminal disposal value is expected. Techno Labs' required rate of return is $12\%.$ Assume all cash flows occur at year$-$end except for initial investment amounts. Techno Labs uses straight$-$line depreciation.

Present Value of $$1$ table

Present Value of Annuity of $$1$ table

Future Value of $$1$ table

Future Value of Annuity of $$1$ table

Read the requirements.

Requirement $1.$ Calculate the following for the special$-$purpose eye$-$testing machine:

a$.$ Net present value $($NPV$)($Use factors to three decimal places,

X$.$XXX$,$ and use a minus sign or parentheses for a negative net present value. Enter the net present value of the investment rounded to the nearest whole dollar.$)$

The net present value is

Requirements

Calculate the following for the special$-$purpose eye$-$testing machine:

a$.$ Net present value

b$.$ Payback period

c$.$ Internal rate of return

d$.$ Accrual accounting rate of return based on net initial investment

e$.$ Accrual accounting rate of return based on average investment

What other factors should Techno Labs consider in deciding whether to purchase the special$-$purpose eye$-$testing machine?