Braxton Manufacturing Is Considering the Purchase of New Computerized Equipment

Multiple Choice

Braxton Manufacturing is considering the purchase of new computerized equipment.The machine costs $75,000 and would generate $22,000 in annual cost savings over its 5-year life.At the end of 5 years, the equipment would have a $5,000 salvage value.Braxton's required rate of return is 12%.Using the interest tables, the machine's net present value is

A) $695.
B) $4,305.
C) $7,143.
D) $79,306.