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Net present value method The following data are accumulated by Geddes Company in evaluating the purchase of $120,000 of equipment, having a four-year useful life:
Net present value method
The following data are accumulated by Geddes Company in evaluating the purchase of $120,000 of equipment, having a four-year useful life:
Net Income | Net Cash Flow | |||
Year 1 | $46,000 | $76,000 | ||
Year 2 | 20,500 | 50,500 | ||
Year 3 | 17,500 | 47,500 | ||
Year 4 | 4,000 | 34,000 |
Assuming that the desired rate of return is 10%, determine the net present value for the proposal. If required, round to the nearest dollar.
Net present value | $ |
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