# Jefferson Labs , a nonprofit organization , estimates that it can save \$33 090 a year in cash operating costs for the next & years if it buys

Jefferson Labs , a nonprofit organization , estimates that it can save \$33 090 a year in cash operating costs
for the next &amp; years if it buys a special-purpose eye – testing mach
testing machine at a cost
cost of \$140 000 . No terminal disposal value is
expected . Jefferson Labs required rate of return is 12% . Assume all cash flows occur
at year – end except for initial investment amounts . Jefferson Labs uses straight line depreciation
resent Value of \$1 table Present Value of Annuity of \$1 table Future Value of ST table Future Value of Annuity of ST table
Requirement 1 Calculate the following for the special – purpose eye – testing machine :
a . Net present value ( NPV ) ( Use factors to three decimal places X X X X and use a minus sign or parentheses for a negative net present value Enter the net present
I value of the investment rounded to the nearest whole dollar . )
The net present value is s
Calculate the following for the
for the special – purpose eye – testing machine
a . Net present value
b . Payback period
C . Internal rate of return
Accrual accounting rate of return based on net initial investment
Accrual accounting rate of return based on average investme
2 . What other factors should Jefferson
Labs consider in deciding whether to
purchase the special-purpose eye- testing machine ?