132.CJ Manufacturing purchased some equipment 3 years ago. The company's required rate of return is 12%, and the net present value of the project was $(900). Annual cost savings were: $10,000 for year 1; $8,000 for year 2; and $6,000 for year 3. The amount of the initial investment was Year Present Value of 1 at 12% PV of an Annuity of 1 at 12% 1 .893 .893 2 .797 1.690 3 .712 2.402 a$20,116. b$18,678. c$18,316. d$20,478. 2.Roger Industries is considering two capital investment proposals. Estimates regarding each project are provided below: Project XR8 Project AAA Initial investment $800,000 $1,200,000 Annual net income 40,000 84,000 Net annual cash inflow 200,000 284,000 Estimated useful life 5 years 6 years Salvage value 0 0 The company requires a 10% rate of return on all new investments. Present Value of an Annuity of 1 Periods 9% 10% 11% 12% 5 3.890 3.791 3.696 3.605 6 4.486 4.355 4.231 4.111 The cash payback period for Project XR8 is a5 years. b10 years. c4 years. d20 years. 3.Roger Industries is considering two capital investment proposals. Estimates regarding each project are provided below: Project XR8 Project AAA Initial investment $800,000 $1,200,000 Annual net income 40,000 84,000 Net annual cash inflow 200,000 284,000 Estimated useful life 5 years 6 years Salvage value 0 0 The company requires a 10% rate of return on all new investments. Present Value of an Annuity of 1 Periods 9% 10% 11% 12% 5 3.890 3.791 3.696 3.605 6 4.486 4.355 4.231 4.111 The annual rate of return for Project XR8 is a25%. b50%. c5%. d10% 4.Roger Industries is considering two capital investment proposals. Estimates regarding each project are provided below: Project XR8 Project AAA Initial investment $800,000 $1,200,000 Annual net income 40,000 84,000 Net annual cash inflow 200,000 284,000 Estimated useful life 5 years 6 years Salvage value 0 0 The company requires a 10% rate of return on all new investments. Present Value of an Annuity of 1 Periods 9% 10% 11% 12% 5 3.890 3.791 3.696 3.605 6 4.486 4.355 4.231 4.111 The net present value for Project AAA is a$36,820. b$200,000. c$1,236,820. d$365,824. 5.Taffy Industries is considering purchasing equipment costing $60,000 with a 6-year useful life. The equipment will provide cost savings of $14,600 and will be depreciated straight-line over its useful life with no salvage value. Taffy Industries requires a 10% rate of return. Present Value of an Annuity of 1 Periods 8% 9% 10% 11% 12% 13% 6 4.623 4.486 4.355 4.231 4.111 3.784 What is the approximate net present value of this investment? a$1,772 b$27,600 c$5,496 d$3,584 6.Taffy Industries is considering purchasing equipment costing $60,000 with a 6-year useful life. The equipment will provide cost savings of $14,600 and will be depreciated straight-line over its useful life with no salvage value. Taffy Industries requires a 10% rate of return. Present Value of an Annuity of 1 Periods 8% 9% 10% 11% 12% 13% 6 4.623 4.486 4.355 4.231 4.111 3.784 What is the approximate internal rate of return for this investment? a12% b10% c11% d9% 7.Use the following table, Present Value of an Annuity of 1 Periods 8% 9% 10% 1 .926 .917 .909 2 1.783 1.759 1.736 3 2.577 2.531 2.487 A company has a minimum required rate of return of 9%. It is considering investing in a project which costs $840,000 and is expected to generate cash inflows of $336,000 at the end of each year for three years. The net present value of this project is a$85,032. b$10,416. c$504,000. d$850,416