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Nylan Manufacturing is considering two alternative investment proposals with the following details: proposal X investment 720,000 useful life 5 years est annual net cash inflows
Nylan Manufacturing is considering two alternative investment proposals with the following details:
| proposal X | |
| investment | 720,000 |
| useful life | 5 years |
| est annual net cash inflows | 150,000 |
| residual value | 50,000 |
| depreciation method | straight line |
| discount rate | 10% |
What is the total present value of the future cash inflows from proposal X?
Present Value of Annuity of $1
| 8% | 9% | 10% | |
| 1 | 0.926 | 0.92 | 0.909 |
| 2 | 1.783 | 1.759 | 1.736 |
| 3 | 2.577 | 2.531 | 2.487 |
| 4 | 3.312 | 3.324 | 3.17 |
| 5 | 3.993 | 3.89 | 3.791 |
| 6 | 4.623 | 4.486 | 4.355 |
Present Value of $1
| 8% | 9% | 10% | |
| 1 | 0.926 | 0.917 | 0.909 |
| 2 | 0.857 | 0.842 | 0.826 |
| 3 | 0.794 | 0.772 | 0.751 |
| 4 | 0.735 | 0.708 | 0.683 |
| 5 | 0.681 | 0.65 | 0.621 |
| 6 | 0.63 | 0.596 | 0.564 |
a) 742,340
b) 650,070
c) 568,650
d) 599,700
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