The management of Arnold Corporation is considering the purchase of a new machine costing $430,000. The company's desired rate of return is 10%. The present value factors for $1 at compound interest of 10% for 1 through 5 years are 0.909, 0.826, 0.751, 0.683, and 0.621, respectively. In addition to this information, use the following data in determining the acceptability of the proposed purchase: Year Income From Operations Net Cash Flow
1 $100,000 180,000
2 40,000 120,000
3 20,000 100,000
4 10,000 90,000
5 10,000 90,000