Paramount Company Is Considering Purchasing New Equipment Costing $706,000 The Company's Required Rate of Return Is 10

Multiple Choice

Paramount Company is considering purchasing new equipment costing $706,000.Company's management has estimated that the equipment will generate cash flows as follows:
$$\begin{array} { | r|r | } \hline \text { Year } 1& \$ 204,000 \\\hline 2&204,000 \\\hline 3&252,000 \\\hline 4&252,000 \\\hline 5&164,000 \\\hline\end{array}$$
The company's required rate of return is 10%.Using the factors in the table below,calculate the present value of the cash inflows.Present value of $1:
$$\begin{array} { | l | r | r | r | r | r | } \hline &{ 6 \% } & { 7 \% } & { 8 \% } & { 9 \% } & 10 \% \\\hline 1 & 0.943 & 0.935 & 0.926 & 0.917 & 0.909 \\\hline 2 & 0.89 & 0.873 & 0.857 & 0.842 & 0.826 \\\hline 3 & 0.84 & 0.816 & 0.794 & 0.772 & 0.751 \\\hline 4 & 0.792 & 0.763 & 0.735 & 0.708 & 0.683 \\\hline 5 & 0.747 & 0.713 & 0.681 & 0.65 & 0.621 \\\hline\end{array}$$

A) $786,685
B) $817,152
C) $775,512
D) $771,557