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6. a. The management of Fine Electronics Company is considering to purchase an equipment to be attached with the main manufacturing machine. The equipment will

6. a. The management of Fine Electronics Company is considering to purchase an equipment to be attached with the main manufacturing machine. The equipment will cost $6,000 and will increase annual cash inflow by $2,200. The useful life of the equipment is 6 years. After 6 years it will have no salvage value. The management wants a 20% return on all investments. 1. 2. 15 Compute net present value (NPV) of this investment project. Should the equipment be purchased according to NPV analysis? b. Explain IFRS. 05

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