Lloyd's Moving Company is considering purchasing new equipment that costs $728,000

Its management estimates that the equipment will generate cash flows as follows:

Year 1 $214,000
2 214,000
3 264,000
4 264,000
5 150,000

Present value of $1:

6% 7% 8% 9% 10%
1 0.943 0.935 0.926 0.917 0.909
2 0.890 0.873 0.857 0.842 0.826
3 0.840 0.816 0.794 0.772 0.751
4 0.792 0.763 0.735 0.708 0.683
5 0.747 0.713 0.681 0.650 0.621

The company's annual required rate of return is 9%. Using the factors in the table, calculate the present value of the cash flows. (Round all calculations to the nearest whole dollar.)
A) $892,000
B) $864,646
C) $853,320
D) $894,000

B .B)
Calculation of present value of cash inflows:

Cash Inflows PV factors at 9% Present Value
$214,000 0.917 $196,238
214,000 0.842 180,188
264,000 0.772 203,808
264,000 0.708 186,912
150,000 0.650 97,500
$864,646