Richman Co A)$20,478
B)$18,316

Richman Co.purchased some equipment 3 years ago.The company's required rate of return is 12%, and the net present value of the project was $(900) .Annual cost savings were: $10,000 for year 1; $8,000 for year 2; and $6,000 for year 3.The amount of the initial investment was $\begin{array}{rrr}& \text { Present Value } & \text { PV of an Annuity } \\\text { Year } & \text { of } 1 \text { at } 12 \% & \text { of } 1 \text { at } 12 \% \\1 & .893 & .893 \\2 & .797 & 1.690 \\3 & .712 & 2.402\end{array}$

A) $20,478.
B) $18,316.
C) $20,116.
D) $18,678.