Annual cash inflows that will arise from two competing investment projects are given below: Year Investment B Investment A $ 1,000 1 $ 4,000 2 2,000 3,000 3 2,000 3,000 4,000 4 1,000 $ 10,000 $10,000 The discount rate is 9%. Click here to view Exhibit 12B-1 and Exhibit 12B-2, to determine the appropriate discount factor(s) using tables. equired: compute the present value of the cash inflows for each investment. Each investment opportunity will require the same initial vestment.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Annual cash inflows that will arise from two competing investment projects are given below:
Year
Investment A
Investment B
1
$ 4,000
$ 1,000
2,000
2
3,000
3
3,000
2,000
4
4,000
1,000
$ 10,000
$10,000
The discount rate is 9%.
Click here to view Exhibit 12B-1 and Exhibit 12B-2, to determine the appropriate discount factor(s) using tables.
Required:
Compute the present value of the cash inflows for each investment. Each investment opportunity will require the same initial
investment.
Present Value of Cash Flows
Year
Investment A
Investment B
1
2
P
3
4
Transcribed Image Text:Annual cash inflows that will arise from two competing investment projects are given below: Year Investment A Investment B 1 $ 4,000 $ 1,000 2,000 2 3,000 3 3,000 2,000 4 4,000 1,000 $ 10,000 $10,000 The discount rate is 9%. Click here to view Exhibit 12B-1 and Exhibit 12B-2, to determine the appropriate discount factor(s) using tables. Required: Compute the present value of the cash inflows for each investment. Each investment opportunity will require the same initial investment. Present Value of Cash Flows Year Investment A Investment B 1 2 P 3 4
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