FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Transcribed Image Text:Present value of $1
Periods
4%
6%
8%
10%
12%
14%
1
0.96154
0.94340
0.92593
0.90909
0.89286
0.87719
2
0.92456
0.89000
0.85734
0.82645
0.79719
0.76947
3
0.88900
0.83962
0.79383
0.75131
0.71178
0.67497
4567899
0.85480
0.79209
0.73503
0.68301
0.63552
0.59208
0.82193
0.74726
0.68058
0.62092
0.56743
0.51937
0.79031
0.70496
0.63017
0.56447
0.50663
0.45559
0.75992
0.66506
0.58349
0.51316
0.45235
0.39964
0.73069
0.62741
0.54027
0.46651
0.40388
0.35056
0.70259
0.59190
0.50025
0.42410
0.36061
0.30751
10
0.67556
0.55839
0.46319
0.38554
0.32197
0.26974
Present value of an annuity of $1
Periods
4%
6%
8%
10%
12%
14%
1
0.96154
0.94340
0.92593
0.90909
0.89286
0.87719
2
1.88609
1.83339
1.78326
1.73554
1.69005
1.64666
3
2.77509
2.67301
2.57710
2.48685
2.40183
2.32163
45678
3.62990
3.46511
3.31213
3.16987
3.03735
2.91371
4.45182
4.21236
3.99271
3.79079
3.60478
3.43308
5.24214
4.91732
4.62288
4.35526
4.11141
3.88867
6.00205
5.58238
5.20637
4.86842
4.56376
4.28830
6.73274
6.20979
5.74664
5.33493
4.96764
4.63886
9
7.43533
6.80169
6.24689
5.75902
5.32825
4.94637
10
8.11090
7.36009
6.71008 6.14457
5.65022
5.21612
Roman Knoze is considering two investments. Each will cost $20,000 initially. Project 1 will return annual cash
flows of $10,000 in each of three years. Project 2 will return $5,000 in Year 1, $10,000 in Year 2, and $15,000
in Year 3. Roman requires a minimum rate of return of 10%. What is the net present value of Project 2? (Use
the discount tables provided and round each present value calculation to the nearest dollar.)
O a. $4,080
O b. $24,070
c. $2,530
O d. $5,670
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