Jenks Company Financed the Purchase of a Machine by Paying

Multiple Choice

Jenks Company financed the purchase of a machine by paying $24,000 a year for the next five years,with the first payment due one year from today.The purchase cost of the machine is considered to be the present value of those payments.What was the purchase cost of the machine to Jenks assuming a discount rate of 8%?

A) $35,264
B) $95,825
C) $120,000
D) $140,800