The asset will be depreciated on a straight line basis to

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Blain Corporation is considering the purchase of a machine which has an expected 8 year life and costs $20,000. The annual expected NET CASH FLOW from the machine is $5,000 for the first 7 years and $9,000 in year 8, excluding salvage values. The asset will be depreciated on a straight line basis to a $4,000 salvage value. It is eligible for a 7% investment tax credit. If the discount rate is 10%, what is the machine's NPV?

Reference no: EM13479460

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