10: Assignment - The Basics of Capital Budgeting: Evaluating Cash Flows 3. Net present value method Consider the case of Rydell Enterprises: Rydell Enterprises is evaluating a proposed capital budgeting project that will require an initial investment of $112,000. The project is expected to generate the following net cash flows: Year Cash Flow Year 1 Year 2 $36,400 $50,300 $44,400 $40,900 Year 3 Year 4 Assume the desired rate of return on a project of this type is 10%. What is the net present value of this project? (Note: Do not round your Intermediate calculations.) O $18,304.10 $13,065.40 -$10,073.90 O $23,954.78 Suppose Rydell Enterprises has enough capital to fund the project, and the project is not competing for funding with other projects. Should Rydell Foto 2 10: Assignment - The Basics of Capital Budgeting: Evaluating Cash Flows Year 2 $50,300 Year 3 $44,400 Year 4 $40,900 Assume the desired rate of return on a project of this type is 10%. What is the net present value of this project? (Note: Do not round your intermediate calculations.) O $18,304.10 O $13,065.40 - $10,073.90 O $23,954.78 Suppose Rydell Enterprises has enough capital to fund the project, and the project is not competing for funding with other projects. Should Rydell Enterprises accept or reject this project? Reject the project O Accept the project