changing discount rate to 10%

+ 1 2 3 4 5 3 Data 4. Example E 5 Cost of equipment needed $60,000 6 Working capital needed $100.000 7 Overhaul of equipment in four years $5.000 8 Salvage value of the equipment in five ye $10.000 9 Annual revenues and costs 10 Sales revenues $200.000 11 Cost of goods sold $125.000 12 Out-of-pocket operating costs $35 000 13 Discountate 14 15 Entara Kawula into each of the ci markedeth below 16 Exhibit 14-8 17 18 Now 19 Purchase of equipment 2 20 Investment in working capital 21 Sales 22 Cost of goods sold 23 Out-of-pocket operating costs 24 Overhaul of equipment 25 Salvage value of the equipment 26 Working capital released 27 Totalcach lows(a) 28 Discount factor (14%b 29 Present value of cash flowsabi 2 30 Net presenta 31 32 Use the formulas from Appendix 138 33 Present value of 11 34 Present value of an annuity of 11111-11 35 where not the number of years and is the discounttate 2 ? 2 2 ? ? 2 ? ? ? 2 2 ? 2 2 2 2 ? ? ? 2 ? 2 2 2 2 Verify that your worksheet matches the example in the text. Check your worksheet by changing the discount rate to 10%. The net present value should now be between $56,400 and $56,535-depending on the precision of the calculations. If you do not get an answer in this range, find the errors in your worksheet and correct them. If you did not use formulas to calculate the Discount Factors, be sure that those values are updated appropriately using the Appendix 148 formulas that are also noted at the bottom of the spreadsheet instead of using the Discount Factor tables