Darrington Inc. is evaluating an equipment purchase which requires an expenditure of $393 today followed by an inflow of $150 in year one, $200 in year two, and $253 in year three.  What is the net present value of these cash flows to the nearest cent if the discount rate is 8%?

A company is considering a $184,000 investment in machinery with the following net cash flows. The company requires a 10% return on its investments. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Net Cash Flow (a) Compute the net present value of this investment. (b) Should the machinery be purchased? Required A Required B Year 1 $11,000 Year Year 2 $31,000 Complete this question by entering your answers in the tabs below. Year 1 Year 2 Year 3 Net Cash Flows Year 3 $61,000 Compute the net present value of this investment. (Round your present value factor to 4 decimals. Round your final answers to the nearest whole dollar.) Present Value Factor Year 4 $46,000 Present Value of Net Cash Flows Year 5 $123,000

MKM International is seeking to purchase a new CNC machine in order to reduce costs. Two alternative machines are in consideration. Machine 1 costs $400,000, but yields a 15 percent savings over the current machine used. Machine 2 costs $950,000, but yields a 25 percent savings over the current machine used. In order to meet demand, the following forecasted cost information for the current machine is also provided. Year 1 2 23 3 4 5 Project Cost 1,000,000 1,350,000 1,400,000 1,450,000 2,500,000 a. Based on the NPV of the cash flows for these 5 years, which machine should MKM International purchase? Assume a discount rate of 11 percent. Assuming a discount rate of 11 percent, MKM International should purchase NPV of machine 1 is $ nearest whole number.) b. If MKM International lowered its required discount rate to 9 percent, what machine would it purchase? because the and the NPV of machine 2 is $. (Enter your responses rounded to the Assuming a discount rate of 9 percent, MKM…

1. A mechanical device will cost $30,000 when purchased. Maintenance will cost $2,000 each year. The device will generate revenues of $5,000 each year for five years. At the end of the fifth year, the salvage value of the device is $6,500. Draw and simplify the cash flow diagram. Calculate: (a) the present value and (b) the equivalent annual cost of the cash flows using a discount rate of 12%.