Pippen Inc. is

considering a six-year project to improve its production efficiency. Buying a

machine for $2,000,000 is estimated to result in $340,000 in annual pre-tax

cost savings. The machine falls into Class 8 for CCA purposes (CCA rate of 20

percent per year; Accelerated Investment Incentive in the first year is applied),

and it will have a salvage value at the end of the project of $458,752. The

machine also requires an initial investment in spare parts inventory of $200,000,

that will be regained at the end of the project. If the tax rate is 30 percent

and its discount rate is 15 percent, what is the Net Present Value for this

project?

Give the answer in

thousands of dollars without decimal places, rounding to the nearest thousand

(e.g., if the answer would be $154,790.34, give 155; or if the answer would be

$154,392.28, give 154).