FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Annual cash inflows that will arise from two competing investment projects are given below:
Investment B
$ 10,000
9,000
8,000
7,000
$ 34,000
Year
1
2
3
4
Investment A
$ 7,000
8,000
9,000
10,000
$ 34,000
The discount rate is 7%.
Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s) using tables.
Required:
Compute the present value of the cash inflows for each investment.
Year
1
2
3
4
Present Value of Cash Flows
Investment B
Investment A
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Transcribed Image Text:Annual cash inflows that will arise from two competing investment projects are given below: Investment B $ 10,000 9,000 8,000 7,000 $ 34,000 Year 1 2 3 4 Investment A $ 7,000 8,000 9,000 10,000 $ 34,000 The discount rate is 7%. Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s) using tables. Required: Compute the present value of the cash inflows for each investment. Year 1 2 3 4 Present Value of Cash Flows Investment B Investment A
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