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Can anyone please help with the last part? Thank you! Drake Corporation is reviewing an investment proposal. The initial cost is $105,700. Estimates of the
Can anyone please help with the last part? Thank you!
Drake Corporation is reviewing an investment proposal. The initial cost is $105,700. Estimates of the book value of the investment at the end of each year, the net cash flows for each year, and the net income for each year are presented in the schedule below. All cash flows are assumed to take place at the end of the year. The salvage value of the investment at the end of each year is assumed to equal its book value. There would be no salvage value at the end of the investment's life Investment Proposal Book Annual Value Cash Flows $70,500 $44.900 Year Annual Net Income 1 $9.700 2 42 400 39.200 11.100 20.600 36.000 14.200 4 6,800 29,100 15,300 0 25.205 18,405 Drake Corporation uses an 11% target rate of return for new investment proposals What is the cash payback period for this proposal? (Round answer to 2 decimal places, s. 10.50) Cash payback period 26 years (b) What is the annual rate of return for the investment (Round answer to 2 decimal ploces es 10 SOK) Annual rate of return for the investment 20 10 What is the net present value of the investment? If the net present value is negative, use either a nepotive sigri preceding the number es 45 or parentheses (45). Round answer to decimal places . 125 Por calculation purposes, se decimal places as displayed in the factor table provided) Net present value 22034 Step by Step Solution
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