Question
Monk Inc. is contemplating the purchase of an asset costing $50,000 which will provide cost savings of $18,000 in year 1, $20,000 in year 2
Monk Inc. is contemplating the purchase of an asset costing $50,000 which will provide cost savings of $18,000 in year 1, $20,000 in year 2 and $22,000 in year 3. The asset will have a salvage value of $5,000. The company uses a 10% discount rate. The company uses straight-line depreciation. The net present value of this project is
- A. ($260).
- B. $3,159.
- C. $5,234.
- D. $3,885.
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Financial Accounting
Authors: David Spiceland, Wayne M. Thomas, Don Herrmann
5th edition
1259914895, 978-1259914898
