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Calculate the net present value of the proposed equipment purchase. Bramble uses a 10% discount rate. (For calculation purposes, use 4 decimal places as displayed in the factor table provided and round final answer to O decimal place, e.g. 58,971.) Net present value $

Calculate the net present value of the proposed equipment purchase. Bramble uses a 10% discount rate. (For calculation purposes, use 4 decimal places as displayed in the factor table provided and round final answer to O decimal place, e.g. 58,971.) Net present value $

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter19: Capital Investment
Section: Chapter Questions
Problem 22E
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Appendix 9.1 – Period 7 at 10%Present value of $1 received in n periods= 0.5132

Appendix 9.2- Period 4 at 14% Present value of an annuity of $1 per period = 4.8684

 

The Bramble Company is planning to purchase $456,000 of equipment with an estimated 7-year life and no estimated salvage value. The company has projected the following annual cash flows for the investment: Year 1 2 3 4 5 7 Total Projected Cash Flows $202,000 140,000 113,000 50,000 64,100 40,500 47,400 $657,000 Click here to view the factor table. Calculate the net present value of the proposed equipment purchase. Bramble uses a 10% discount rate. (For calculation purposes, use 4 decimal places as displayed in the factor table provided and round final answer to O decimal place, e.g. 58,971.) Net present value $
Transcribed Image Text:The Bramble Company is planning to purchase $456,000 of equipment with an estimated 7-year life and no estimated salvage value. The company has projected the following annual cash flows for the investment: Year 1 2 3 4 5 7 Total Projected Cash Flows $202,000 140,000 113,000 50,000 64,100 40,500 47,400 $657,000 Click here to view the factor table. Calculate the net present value of the proposed equipment purchase. Bramble uses a 10% discount rate. (For calculation purposes, use 4 decimal places as displayed in the factor table provided and round final answer to O decimal place, e.g. 58,971.) Net present value $
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