Question
(Ignore income taxes in this problem.) Rushforth Manufacturing has $102,000 to invest in either Project A or Project B. The following data are available on
(Ignore income taxes in this problem.) Rushforth Manufacturing has $102,000 to invest in either Project A or Project B. The following data are available on these projects: Project A Project B Cost of equipment needed now $102,000 $46,000 Working capital investment needed now $56,000 Annual cash operating inflows $38,000 $26,800 Salvage value of equipment in 6 years $13,000 Both projects will have a useful life of 6 years. At the end of 6 years, the working capital investment will be released for use elsewhere. Rushforth's required rate of return is 14%. The net present value of Project B is: (Round final answer to the nearest whole dollar.) rev: 12_14_2012, 12_21_2012 $27,729 $14,280 $58,225 $2,225
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