Use the table of present value factors with this problem. A link to download a copy of the PV factors is provided in the test instructions guidelines.

Salwasser Manufacturing wants to purchase a machine for $40,000 but needs to earn a 12% return. The machine is to be depreciated straight line over 4 years with zero salvage value. The expected year-end accrual net incomes are $2,000 in each of the first three years, and $7,000 in the fourth year.

Should the company buy the machine?

Group of answer choices

No, because the net present value is -30,747.7

No, because the net present value is -373.7

Yes, because the net present value is 373.7

Yes, because the net present value is 30,747.7

No, because the net present value is -27,000.