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Exercise 13-7 Net Present Value Analysis of Two Alternatives [LO13-2] Perit Industries has $110,000 to invest. The company is trying to decide between two alternative

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Exercise 13-7 Net Present Value Analysis of Two Alternatives [LO13-2] Perit Industries has $110,000 to invest. The company is trying to decide between two alternative uses of the funds. The alternatives are: Project A Project B $110,000 Cost of equipment required Working capital investment required Annual cash inflows $110,000 28,000 0 20,000 8,100 Salvage value of equipment in six years Life of the project 0 6 years 6 years The working capital needed for project B will be released at the end of six years for investment elsewhere. Perit Industries' discount rate is 15% Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using tables. Required: 1. Compute the net present value of Project A. (Enter negative values with a minus sign. Round your final answer to the nearest whole dollar amount.) 2. Compute the net present value of Project B. (Enter negative values with a minus sign. Round your final answer to the nearest whole dollar amount.) 3. Which investment alternative (if either) would you recommend that the company accept

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