View Policies Current Attempt in Progress Novak Company is considering investing in a new dock that will cost $670,000. The company expects to use the dock for 5 years, after which it will be sold for $410,000. Novak anticipates annual cash flows of $220,000 resulting from the new dock. The company's borrowing rate is 8%, while its cost of capital is 11% Click here to view PV tables. Calculate the net present value of the dock (Use the above table) (Round factor values to 5 decimal places, eg. 1.25124 and final answer to O decimal places, eg 5,275) Net present value Indicate whether Novak should make the investment. Novak Save for Later the project Attempts: 0 of 1 used Submit Answer

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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View Policies
Current Attempt in Progress
Novak Company is considering investing in a new dock that will cost $670,000. The company expects to use the dock for 5 years, after
which it will be sold for $410,000. Novak anticipates annual cash flows of $220,000 resulting from the new dock. The company's
borrowing rate is 8%, while its cost of capital is 11%
Click here to view PV tables.
Calculate the net present value of the dock (Use the above table) (Round factor values to 5 decimal places, eg. 1.25124 and final answer
to O decimal places, eg 5,275)
Net present value
Indicate whether Novak should make the investment.
Novak
Save for Later
the project
Attempts: 0 of 1 used Submit Answer
Transcribed Image Text:View Policies Current Attempt in Progress Novak Company is considering investing in a new dock that will cost $670,000. The company expects to use the dock for 5 years, after which it will be sold for $410,000. Novak anticipates annual cash flows of $220,000 resulting from the new dock. The company's borrowing rate is 8%, while its cost of capital is 11% Click here to view PV tables. Calculate the net present value of the dock (Use the above table) (Round factor values to 5 decimal places, eg. 1.25124 and final answer to O decimal places, eg 5,275) Net present value Indicate whether Novak should make the investment. Novak Save for Later the project Attempts: 0 of 1 used Submit Answer
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