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McMiller Inc. has several analysts working on this project. The company's staff are overworked and putting in overtime that is costing the company to go
McMiller Inc. has several analysts working on this project. The company's staff are overworked and putting in overtime that is costing the company to go over their budget for staff wages. The analysts provided the following data concerning a proposed project (Ignore income taxes.):
Initial investment | $ 10,000 | |
---|---|---|
Annual cost savings | $ ? | |
Salvage value | $ 0 | |
Life of the project | 8 | years |
Discount rate | 14% | |
Net present value | $ 1,300 |
Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s) using the tables provided.
The annual cost savings must be closest to: (Round your intermediate calculations to 3 decimal places.)
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