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Exercise 24-2 Net present value LO P3 Beyer Company is considering the purchase of an asset for $205,000. It is expected to produce the following
Exercise 24-2 Net present value LO P3 Beyer Company is considering the purchase of an asset for $205,000. 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 3 $100,000 Year 2 $46,000 Net cash flows $78,000 Year 4 $158,000 Year 5 $43,000 Total $425,000 a. Compute the net present value of this investment. b. Should Beyer accept the investment? Complete this question by entering your answers in the tabs below. Required A Required B Compute the net present value of this investment. (Round your answers to the nearest whole dollar.) Year Net Cash Flows Present Value of 1 at 9% Present Value of Net Cash Flows 1 2 3 4 5 Totals Amount invested Net present value B Required A Required B Should Beyer accept the investment? Should Beyer accept the investment?
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