Question
Elsie Moving Company is considering purchasing new equipment that cost$728,000. Its management estimates that the equipment will generate cash flows asfollows: Year 1 218000 2
Elsie Moving Company is considering purchasing new equipment that cost$728,000. Its management estimates that the equipment will generate cash flows asfollows:
| Year 1 | 218000 |
| 218,000 | |
| 3 | 260,000 |
| 4 | 260,000 |
| 5 | 170,000 |
Thecompany's required rate of return is10%. Using the factors in the tablebelow, calculate the present value of the cash inflows.(Round all calculations to the nearest wholedollar.)
Present value of$1:
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Accounting Principles
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
10th Edition
1119491630, 978-1119491637, 978-0470534793
