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A company is considering a $171,000 investment in machinery with the following net cash flows. The company requires a 10% return on its investments.
A company is considering a $171,000 investment in machinery with the following net cash flows. The company requires a 10% return on its investments. (PV of $1. EV of $1. PVA of $1 and EVA of $1) (Use appropriate factor(s) from the tables provided.) Net Cash Flow Year 11 $10,000 Year 2 $29,000 Year 3 $56,000 Year 4 $43,000 Year 5 $115,000 (a) Compute the net present value of this investment. (b) Should the machinery be purchased? 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 $ 10,000 Year 2 29.000 Year 3 56,000 Year 4 43,000 Year 5 115,000 $ 253,000 $ Totals Initial investment Net present value S Required A 0 Required B >
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