B nitial investment Annual cash flow $ 480,000 $ 145,000 per year Refer to Exhibit 12B-1 and Exhibit 12B-2, to determine the appropriate discount factor(s) using tables provided. The life of the project is 4 years. The company's discount rate is 8%. The net present value of th project is closest to: A) $480,000 B) $480,240 C) $100,000 D) $240 23. Crockin Corporation is considering a machine that will save $9,000 a year in cash operating costs each year for the next six years. At the end of six years it would have no salvage value. If this machine costs $33,165 now, the machine's internal rate of return is closest to (Ignore income taxes.): Refer to Exhibit 12B-1 and Exhibit 12B-2, to determine the appropriate discount factor(s) using the tables provided. A) 16% B) 17% C) 18% D) 19% 24. Ryner Corporation is considering three investment projects: S, T, and U. Project S would require an investment of $20,000, Project T of $69,000, and Project U of $83,000. No other cash outflows would be involved. The present value of the cash inflows would be $23,200 for Project S, $77,970 for Project T, and $94,620 for Project U. Rank the projects according to the profitability index, from most profitable to least profitable. (Ignore income taxes.) A) U, T, S B) T, S, U C) U, S, T D) S, UT 25. The management of Ro Corporation is investigating automating a process. Old equipment, with a current salvage value of $11,000, would be replaced by a new machine. The new machine would be purchased for $243,000 and would have a 9 year useful life and no salvage value. By automating the process, the company would save $69,000 per year in cash operating costs. The simple rate of return on the investment is closest to (Ignore income taxes.): A) 18.1% B) 11.1% C) 28.4% D) 17.3% 11 Page