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could you please explain the process if finding the table factor Linda's Luxury Travel (LLT) is considering the purchase of two Hummer limousines. Various information
could you please explain the process if finding the table factor Linda's Luxury Travel (LLT) is considering the purchase of two Hummer limousines. Various information about th proposed investment follows: 10 years Initial investment (2 limos) $1,500,000 Useful life Salvage value $ 140,000 Annual net income generated $ 142,500 LLT's cost of capital 14% Assume straight line depreciation method is used. Required: Help LLT evaluate this project by calculating each of the following: 1. Accounting rate of return. 2. Payback period. 3. Net present value. 4. Without making any calculations, determine whether the IRR is more or less than 14%. Complete this question by entering your answers in the tabs below. Required Required Required Required 2 3 Calculate net present value. (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1.) (Use appropriate factor(s) from the tables provided. Cash Outflows and negative amounts should be indicated by a minus sign. Round your "Present Values" to the nearest whole dollar amount.) Show less $ Table or Calculator Function: Cash Outflow (Beginning of the Year) no = Present Value (1,500,000) 0 14% (1.500.000) $ Present Value Annuity of Table or Calculator Function: IS1 Cash Inflow (for Next 10 Years) S 278,500 n 10 14% Table Factor 5.2161 Present Value 115 11,452,684
could you please explain the process if finding the table factor
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