Exercise 11-9 Computing net present value LO P3 B2B Co. is considering the purchase of equipment that would allow the company to add a new product to its line. The equipment is expected to cost $368,000 with a 6-year life and no salvage value. It will be depreciated on a straight-line basis. The company expects to sell 147,200 units of the equipment's product each year. The expected annual income related to this equipment follows. $ 230,00 Sales Costs Materials, labor, and overhead (except depreciation on new equipment) Depreciation on new equipment Selling and administrative expenses Total costs and expenses Pretax income Income taxes (30%) Net income 81, Bee 61,333 23,008 165,333 64,667 19,400 45,267 $ If at least an 9% return on this Investment must be earned, compute the net present value of this Investment. (PV of $1. FV of $1. PVA of S1, and FVA of $1) (Use approprlate factor(s) from the tables provided.) Chart Values are Based on: ns 0 PV Factor Present Value Select Chart Present Value of an Annuity of 1 Amount X 106.000 $ 0 $ Present value of cash inflows Present value of cash outflows (368,000) Net present value ALU LULUS DUO,UUU WILT O'yeone HU SOIVONE VOLUE. I will be uepieLIQLUQUQIYHOSED TELUR to sell 147,200 units of the equipment's product each year. The expected annual Income related to this equipment follows. $ 230,00 Sales Costs Materials, labor and overhead (except depreciation on new equipment) Depreciation on new equipment Selling and administrative expenses Total costs and expenses Pretax incode Income taxes (30%) Net income 81,000 61,333 23,00 165,333 64,667 19.400 345,26% If at least an 9% retum on this investment must be earned, compute the net present value of this investment. (PV of $1. FV di $1. and FVA of $1) (Use appropriate factor(s) from the tables provided) Answer is not complete. Chart Vs Based on 0 e 55 PV Amount Present olet Chart Present Value of an Annuity of 1 S 106,000 424800 x IS 477.688 5 Present value of cash inflows Present value of cash outfiows 477,608 368,000)