Exercise 10-5A (Algo) Determining net present value LO 10-2 Zachary Company is considering investing in two new vans that are expected to generate combined cash inflows of $32,500 per year. The vans' combined purchase price is $92,500. The expected life and salvage value of each are six years and $20,200, respectively. Zachary has an average cost of capital of 10 percent. (PV of $1 and PVA of $1) (Use appropriate factor(s) from the tables provided.) Required a. Calculate the net present value of the investment opportunity. (Negative amount should be indicated by a minus sign. Round your intermediate calculations and final answer to 2 decimal places.) b. Indicate whether the investment opportunity is expected to earn a return that is above or below the cost of capital and whether it should be accepted. a Net present value b. Will the return be above or below the cost of capital? Should the investment opportunity be accepted? l'Above FAccepted