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Can someone please break down how they get their answers? I really need a step by step of the ones I got incorrect, I don't
Can someone please break down how they get their answers? I really need a step by step of the ones I got incorrect, I don't understand the PV Factor, nor do I understand how to get the other answers I'm missing. Thank you in advance :)
Return to question Exercise 24-9 Computing net present value LO P3 pints B2B Co. is considering the purchase of equipment that would allow the company to add a new product to its line. The equipment is expected to cost $382,400 with a 10-year life and no salvage value. It will be depreciated on a straight-line basis. The company expects to sell 152,960 units of the equipment's product each year. The expected annual income related to this equipment follows. $239,000 Sales Costs Materials, labor, and overhead (except depreciation on new equipment) Depreciation on new equipment Selling and administrative expenses Total costs and expenses Pretax income Income taxes (30%) Net income 84,000 38,240 23,900 146, 140 92,860 27,858 $ 65,002 If at least an 10% return on this investment must be earned, compute the net present value of this investment. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Answer is not complete. Chart Values are Based on: n = i = Select Chart 10 0% X Amount X Factor Present Value 778,032 Present Value of an Annuity of $ 103,242 X 7.5360 = $ $ 778,032 Present value of cash inflows Present value of cash outflows Net present valueStep by Step Solution
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