Cookies R Us Incorporated is evaluating a new cookie cutting machine that will cost $500,000. The machine can be depreciated on a straight-line basis to zero over 10 years. It will provide the company with annual before-tax savings of $135,000. The marginal corporate tax rate is 40% and the required rate of return is 15%. What is the net present value of this cost-cutting asset? Multiple Choice $128,611.12 $157,458.69 -$193,855.11 $6,895.63 $277,909.14

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A:

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