Question
Exercise 11-2 Net present value LO P3 Beyer Company is considering the purchase of an asset for $190,000. It is expected to produce the following
Exercise 11-2 Net present value LO P3 Beyer Company is considering the purchase of an asset for $190,000. It is expected to produce the following net cash flows. The cash flows occur evenly within each year. Assume that Beyer requires a 9% return on its investments. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Year 1 Year 2 Year 3 Year 4 Year 5 Total Net cash flows $ 69,000 $ 49,000 $ 93,000 $ 141,000 $ 38,000 $ 390,000
a. Compute the net present value of this investment. b. Should Beyer accept the investment?
- Required A
- Required B
Compute the net present value of this investment. (Round your answers to the nearest whole dollar.)
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