Newport corp is considering the purchase of a new piece of


Newport Corp is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in cash flow of $207,000. The equipment will have an initial cost of $951,000 and have a 6 year life. There is no salvage value for the equipment. If the hurdle rate is 9%, what is the approximate net present value? Ignore income taxes. (Future Value of $1, Present Value of $1,Future Value Annuity of $1, Present Value Annuity of $1.) (Round your PV factor to 4 decimal places and final answer to the nearest dollar amount.)

a) zero

b) positive $317,000

c) positive $22,419

d) negative $22,419

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Financial Accounting: Newport corp is considering the purchase of a new piece of
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