dolution

Tim Smunt has been asked to evaluate two machines. After some investigation, he determines that they have the costs shown in the following table: Machine A Original Cost Labor per year Maintenance per year $12,000 $2,400 $4,000 $2,000 Machine B $24,000 $4,800 $1,200 $7,200 Salvage value He is told to assume that: 1. The life of each machine is 3 years. 2. The company thinks it knows how to make 14% on investments no more risky than this one. 3. Labor and maintenance are paid at the end of the year. The NPV for Machine A = $ (round your response to the nearest whole number and include a minus sign if necessary). The NPV for Machine B = $ (round your response to the nearest whole number and include a minus sign if necessary). Using the net present value as the basis of comparing the machines, Tim should recommend Machine A