CUORE Net Present Value Use Exhibit 120.1 and Exhibit 128.2 to locate the present value of an annuity of $1, which is the amount to be multiplied times the future annual cash flow amount. Each of the following scenarios is independent. Assume that all cash flows are after-tax cash flows. a. Campbell Manufacturing is considering the purchase of a new welding system. The cash benefits will be $450,000 per year. The system costs $1,750,000 and wilt 10 year b. Evee Cardenas is interested in investing in a women's specialty shop. The cost of the investment is $280,000. She estimates that the turn from owing her own shop will be c. Barker Company calculated the NPV of a project and found it to be $63,900. The project's life was estimated to be 3 years. The required rate of returned for the NPV calcu $135,000 Required: 1. Compute the NP for Campbell Manufacturing, asuming a discount rate of 12%. It required, round all present value calculations to the nearest dallar. Use the minun sign ta -237,894 X Should the company buy the new welding system? Yes 2. Conceptual Connection Assuming a required rate of return of 8%, calculate the NPV for Evee Cardenas investment. Round to the nearest dollar. If required, round will preses -18,199 X Should she invest? No What if the estimated return was $135,000 per year? Calculate the new NPV for Evee Cardenas investment. Would this affect the decision? What does this tell you about your 44,089 X The shop should now be purchased. This reveals that the decision to accept or reject in this case a afected by differences in estimated cash flow 3. What was the required investment for Barker Company's project? Round to the nearest dollar. If required, round all present value calculations to the nearest dollar 656,316 Feedback Check My Wort of an annuity of $1, which is the amount to be multiple times the future cash flow mount shows are after tax cash flows. velding system. The cash benefits will be $450,000 per year. The system costs $1,750,000 and will last 10 years shop. The cost of the investment is $280,000. She estimates that the return from owing her own shop will be 140,000 per year. She estimates that the show willen be $63,900. The project's life was estimated to be 3 years. The required rate of return used for the calculation 10%. The project was expect to certech cunt rate of 12%. If required, round present value calculations to the nearest dollar Use the sign to indicate negative calculate the NPV for Ever Cardenas investment. Round to the nearest dollar. If required, round a present value calculations to the nearest dollar. Use the sun to indicates negative MPY w NPV for Evee Cardenas investment. Would this affect the decision? What does this tell you about your analysis Round to the nearest dollar on to accept or reject in this case is affected by differences in estimated cash flow Round to the nearest dollar. If required, round al present value calculations to the nearest dollar CUORE Net Present Value Use Exhibit 120.1 and Exhibit 128.2 to locate the present value of an annuity of $1, which is the amount to be multiplied times the future annual cash flow amount. Each of the following scenarios is independent. Assume that all cash flows are after-tax cash flows. a. Campbell Manufacturing is considering the purchase of a new welding system. The cash benefits will be $450,000 per year. The system costs $1,750,000 and wilt 10 year b. Evee Cardenas is interested in investing in a women's specialty shop. The cost of the investment is $280,000. She estimates that the turn from owing her own shop will be c. Barker Company calculated the NPV of a project and found it to be $63,900. The project's life was estimated to be 3 years. The required rate of returned for the NPV calcu $135,000 Required: 1. Compute the NP for Campbell Manufacturing, asuming a discount rate of 12%. It required, round all present value calculations to the nearest dallar. Use the minun sign ta -237,894 X Should the company buy the new welding system? Yes 2. Conceptual Connection Assuming a required rate of return of 8%, calculate the NPV for Evee Cardenas investment. Round to the nearest dollar. If required, round will preses -18,199 X Should she invest? No What if the estimated return was $135,000 per year? Calculate the new NPV for Evee Cardenas investment. Would this affect the decision? What does this tell you about your 44,089 X The shop should now be purchased. This reveals that the decision to accept or reject in this case a afected by differences in estimated cash flow 3. What was the required investment for Barker Company's project? Round to the nearest dollar. If required, round all present value calculations to the nearest dollar 656,316 Feedback Check My Wort of an annuity of $1, which is the amount to be multiple times the future cash flow mount shows are after tax cash flows. velding system. The cash benefits will be $450,000 per year. The system costs $1,750,000 and will last 10 years shop. The cost of the investment is $280,000. She estimates that the return from owing her own shop will be 140,000 per year. She estimates that the show willen be $63,900. The project's life was estimated to be 3 years. The required rate of return used for the calculation 10%. The project was expect to certech cunt rate of 12%. If required, round present value calculations to the nearest dollar Use the sign to indicate negative calculate the NPV for Ever Cardenas investment. Round to the nearest dollar. If required, round a present value calculations to the nearest dollar. Use the sun to indicates negative MPY w NPV for Evee Cardenas investment. Would this affect the decision? What does this tell you about your analysis Round to the nearest dollar on to accept or reject in this case is affected by differences in estimated cash flow Round to the nearest dollar. If required, round al present value calculations to the nearest dollar