The Pina Colada Company is planning to purchase $458,000 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: Projected Cash Year Flows $236,000 2 141,000 3 125,000 55,500 60,400 6 44,800 7 46,900 Total $709,600 Click here to view the factor table. Calculate the net present value of the proposed equipment purchase. Pina Colada uses a 7% discount rate. (For calculation purposes, use 4 decimal places as displayed in the factor table provided and round final answer to O decimal place, eg. 58,971.) Net present value $
The Pina Colada Company is planning to purchase $458,000 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: Projected Cash Year Flows $236,000 2 141,000 3 125,000 55,500 60,400 6 44,800 7 46,900 Total $709,600 Click here to view the factor table. Calculate the net present value of the proposed equipment purchase. Pina Colada uses a 7% discount rate. (For calculation purposes, use 4 decimal places as displayed in the factor table provided and round final answer to O decimal place, eg. 58,971.) Net present value $
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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