Suppose you are evaluating a project with the cash inflows shown in the following table. Your boss has asked you to calculate the project’s net present value (NPV). You don’t know the project’s initial cost, but you do know the project’s regular, or conventional, payback period is 2.5 years. The project's annual cash flows are: Year Cash Flow Year 1 $325,000 Year 2 600,000 Year 3 300,000 Year 4 450,000 If the project’s desired rate of return is 9.00%, the project’s NPV is . (Hint: Round your calculations to the nearest dollar.)
Suppose you are evaluating a project with the cash inflows shown in the following table. Your boss has asked you to calculate the project’s net present value (NPV). You don’t know the project’s initial cost, but you do know the project’s regular, or conventional, payback period is 2.5 years. The project's annual cash flows are: Year Cash Flow Year 1 $325,000 Year 2 600,000 Year 3 300,000 Year 4 450,000 If the project’s desired rate of return is 9.00%, the project’s NPV is . (Hint: Round your calculations to the nearest dollar.)
Financial And Managerial Accounting
15th Edition
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:WARREN, Carl S.
Chapter26: Capital Investment Analysis
Section: Chapter Questions
Problem 3CMA
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Suppose you are evaluating a project with the cash inflows shown in the following table. Your boss has asked you to calculate the project’s net present value (NPV). You don’t know the project’s initial cost, but you do know the project’s regular, or conventional, payback period is 2.5 years.
The project's annual cash flows are:
|
Year
|
Cash Flow
|
|---|---|
| Year 1 | $325,000 |
| Year 2 | 600,000 |
| Year 3 | 300,000 |
| Year 4 | 450,000 |
If the project’s desired rate of return is 9.00%, the project’s NPV is . (Hint: Round your calculations to the nearest dollar.)
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