Question
Assume that a company is considering a capital investment project with a four-year time horizon and the following cash flows: Cost of new equipment $
Assume that a company is considering a capital investment project with a four-year time horizon and the following cash flows:
| Cost of new equipment | $ | 210,000 | |
| Working capital required | $ | 50,000 | |
| Annual net cash inflows | $ | 100,000 | |
| Maintenance and repairs in third year | $ | 40,000 | |
| Salvage value of equipment in fourth year | $ | 35,000 | |
Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s) using the tables provided. The working capital will be released at the end of the project and the companys required rate of return is 19%. The net present value of the project is closest to:
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ISO IEC 27001 Lead Auditor Mastering ISMS Audit Techniques
Authors: Dr Tamuka Maziriri
1st Edition
107903160X, 978-1079031607
