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A company is considering a $158,000 investment in machinery with the following net cash flows. The company requires a 10% return on its investments. (PV
A company is considering a $158,000 investment in machinery with the following net cash flows. The company requires a 10% return on its investments. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Net Cash Flow Year 1 $9,000 Year 2 $27,000 (a) Compute the net present value of this investment. (b) Should the machinery be purchased? Year 3 $52,000 Year 4 $40,000 Year 5 $106,000 Complete this question by entering your answers in the tabs below. Required A Required B Compute the net present value of this investment. (Round your present value factor to 4 decimals. Round your final answers to the nearest whole dollar.) Net Cash Year Flows Present Value Factor Present Value of Net Cash Flows Year 1 $ 9,000 Year 2 27,000 Year 3 52,000 Year 4 40,000 Year 5 106,000 $ 234,000 Totals Initial investment Net present value $ < Required A 0 0 Required B >
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