Old MathJax webview

A company is considering a $185,000 investment in machinery with the following net cash flows. The company requires a 10% return on its investments. (PV of $1. FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Net Cash Flow Year 1 $11,000 Year 2 $31,000 Year 3 $61,000 Year 4 $46,000 Year 5 $124,000 (a) Compute the net present value of this investment. (b) Should the machinery be purchased? Complete this question by entering your answers in the tabs below. Required A Required B Compute the net present value of this investment. (Round your present value factor to 4 decimals. Round your final answers to the nearest whole dollar.) Compute the net present value of this investment. (Round your present value factor to 4 decimals. Round your final answers to the nearest whole dollar.) Year Net Cash Flows Present Value Factor Present Value of Net Cash Flows Year 1 Year 2 Year 3 Year 4 Year 5 $ 0 $ Totals Initial investment Net present value $ Required B > Rate Periods 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 12% 15% Periods 1 0.9901 0.9804 0.9709 0.9615 09524 0.9434 0.9346 0.9259 0.9174 0 9091 0.8929 08696 1 2 0.9803 0.9612 0.9426 0.9246 0.9070 0.8900 0.8734 0.8573 0.8417 0.8264 0.7972 0.7561 2 3 0.9706 0.9423 0.9151 0.8890 0.8638 0.8396 0.7722 0.7513 0.7118 0.6575 3 0.8163 0.7629 0.7938 0.7350 4 0.9610 0.9238 0.8885 0.8548 0.8227 0.7921 0 5718 4 0.7084 0.6499 0.6355 0.5674 5 0.9515 0.9057 0.8626 0.8219 0.7835 0.7473 0.7130 0.6830 0.6209 0.5645 0.6806 0.4972 5 6 0.9420 0.8880 0.8375 0.7903 0.7462 0.7050 0.6663 0.6302 0.5963 0 5066 0.1323 6 7 0.9327 0.8706 0.8131 0.7599 0.7107 0.6227 0.5470 0.5132 0.4523 0.3759 7 0.6651 0.6274 8 0.9235 0.8535 0.7894 0.7307 0.6768 0.5820 0.5835 0.5403 0.5002 0.5019 0.4665 01039 03269 8 9 0.9143 0.8368 0.7664 0.7026 0.6446 0.5919 0.5439 9 0.4604 0.42441 0.3606 0.28-13 10 0.9053 0.8203 0.7441 0.6139 0.5083 0.4632 0.4224 03855 0.3220 02172 10 0.6756 0.6496 11 0.8043 0.7224 0.5847 0.4751 11 0.4289 0.3875 0.5584 0.5268 0.4970 0.4688 0.8963 08874 0.8787 0.21.19 0.1869 12 0.7885 0.7014 0.6246 12 0.5568 0.4440 0.3971 0.3505 0.3186 0.2997 0.2875 0.2567 0.2292 0.3555 13 0.7730 0.6006 0.6810 0.5303 0.4150 0163 0.3677 0.3262 4 0.9610 0.9238 V.122 0.8885 0.7513 0.7118 0.8548 0.6575 3 0.7921 5 0.9515 0.7350 0.7084 0.6830 0.9057 0.7629 0.7130 0.6355 0.8626 0.5718 0.8219 4 0.7473 0.6806 0.6499 6 0.8227 0.7835 0.7462 0.7107 0.9420 0.6209 0.8880 0.5674 0.8375 0.7903 5 0.6663 7 0.6302 0.4972 0.4323 0.9327 0.5963 0.7050 0.6651 0.5645 0.5066 0.8706 0.8131 6 0.7599 0.6227 0.5835 8 0.9235 0.8535 0.5132 0.4523 0.3759 0.7894 7 0.7307 0.6274 0.5820 0.5403 9 0.4665 0.9143 0.6768 0.6446 0.8368 0.4039 0.3269 8 0.7664 0.7026 0.5919 0.5002 05470 0.5019 0.4604 0.4224 0.3875 10 0.9053 0.4241 0.3606 0.5439 0.5083 0.2843 0.8203 9 0.7441 0.6756 0.6139 0.5584 0.4632 11 0.3855 0.8963 0.3220 0.8043 10 0.6496 0.5268 0.4751 0.7224 0.7014 0.4289 0.3505 12 0.2875 0.2472 02149 0.1869 11 0.7885 0.6246 0.4970 0.4440 0.3971 0.3555 03186 0.2567 13 12 0.7730 0.6810 0.6006 0.8874 0.8787 0.8700 0.8613 0.5847 0.5568 0.5303 0.5051 0.4810 0.4688 0.4150 0.2897 0.2292 0.1625 13 0.7579 14 15 0.6611 0.5775 0.3262 0.2992 0.4423 0.3677 0.3405 0.3152 0.2633 0.3878 0.3624 0.2046 0.1413 14 0.7430 0.6419 0.5553 0.4173 0.2745 0.2394 0.1827 0.1229 16 0.7284 0.6232 0.5339 0.8528 0.8444 0.4581 0.3936 0.3387 0.2919 0.2519 0.1631 17 0.7142 0.6050 0.5134 0.4363 0.3166 0.2176 0.1978 0.1069 0.0929 IS 16 17 18 18 0.8360 0.7002 0.5874 0.2311 0.2120 0.4936 0.1799 19 0.8277 0.6864 0.4746 0.4155 0.3957 0.3769 0.1945 0.2703 0.2502 0.2317 0.2145 0.1460 0.1456 0.1300 0.1161 0.1037 0.1635 0.2959 0.2765 0.2584 0.1842 19 20 95 0.6730 0.4564 0.1486 0.3714 0.3503 0.3305 0.3118 0.2330 0.1741 0.1301 0.0972 20 0.5703 0.5537 0.4776 0.4120 0.3554 25 0.7798 0.6095 0.3751 0.2953 0.2314 0.1784 0.1160 0.0754 0.0S0S 0.0703 0.0611 0.0304 0.0151 0.0075 0.0923 0.058S 25 30 0.3083 0.1314 0.7419 0.7059 0.0994 30 35 0.5521 0.5000 0.4529 0.2534 0.1813 0.0937 0.0668 0.0573 0.0356 0.0221 35 0.0337 00189 0.0107 0.0676 0.0460 40 06717 0.0490 0.0315 0.3066 0.2083 0.1420 0.003 10 Table B.2 Future Value of 1 f=(1 + 1)" Rate Periods 1% 2% 3% 4% 5% 6% 7% 8% 9% 12% 0 1.0000 Periods 1.0000 1.0000 1.0000 1.0000 10% 1.0000 1.0000 15% 10000 1.0000 1.0000 1.0000 0 1.0100 1.0200 1.0300 1.0400 1 2 1.0600 1.0700 1.0800 1.0500 1.1025 1 1.0201 1.0000 1.1200 1.2544 1.0900 1.1881 1.0404 1.1236 1.1449 1.1000 1 2100 13310 1.1500 1.3225 1.1664 2 3 1.0303 1.0406 1.0816 1.1249 1 1699 1.0612 1.0824 1.1576 1.2250 1.2950 1.0609 1.0927 1.1255 11593 1.1941 3 4 1.1910 1.2625 1.2597 1.3605 1.2155 1.4049 15735 1.4116 4 5 13108 1.4026 1.0510 1.2763 1.7623 5 1 4641 1.6105 1.7716 1.1041 1.1262 1.1487 6 1.5386 1.6771 1.4693 1.5869 1.7138 1.3401 6 1.5007 1.6058 7 1.8280 8 1.1717 1.2299 1.2668 1.3048 1.7182 1.8509 12167 1.2653 13159 1.3686 1.4233 1.4802 1.5395 1.6010 7 8 1.3382 1.4185 1.5036 1.5938 1.6895 1.7908 1.8983 2.0122 1.0615 1.0721 1.0829 1.0937 1 1046 1.1157 1.1268 1 1381 1.9487 2.1436 2.3579 9 1.1951 1.9990 1.8385 1.9672 9 10 1.2190 2.5937 1.9738 2.2107 2.4760 2.7731 3.1058 3.4785 3.5960 +3635 2.1589 2.3316 10 1.2434 1.5209 1.7490 2.0114 2.3131 2.6600 3.0590 3 5179 +0456 4.6524 5.3503 6.1528 70757 S 1371 93576 10 7613 1.3439 1.3842 1.4258 1.4685 2.1049 11 12 13 11 1.4071 1.4775 1.5513 1.6289 1.7103 1.7959 1.8856 1.9799 * 2,0789 2.1829 2.2920 2.4066 2.5182 12 1.6651 2.1329 1.9926 2.1719 2.3674 2.5804 2.8127 3.0658 3.3417 3.6425 3.9703 +3276 4.7171 13 14 1 5126 4.8871 1.2682 1.2936 1 3195 1 3459 1 3728 1 4002 14282 14 15 2.8531 3.1384 3.4523 3.7975 4.1772 4.5950 SOS 1 1495 1 1610 11726 1 1843 1 1961 5.4736 2.2522 2.4098 2.5785 2.7590 2.9522 3.1588 3.3799 13 16 1.7317 1.8009 1.8730 1.9479 2.0258 1.5580 1.6047 16528 1.7024 2.7196 2.9372 3.1722 3.+259 3.7000 3 9960 2.2609 2.3966 2.5404 2.6928 2.8543 16 17 61304 6.5660 6900 18 5 3599 1 11236 1.1881 1.2100 1.2544 13225 3 2 1.0303 1.0612 1.0927 191664 1.2597 1.1249 1.2950 1.3310 1.4049 1.5209 3 4 1.0406 1.0824 1.1255 1.1699 1.1910 1.2625 1.3382 1.3605 1.4116 1.4641 1.5735 1.7490 4 5 1.0510 1.1041 1.1593 1.2167 1.2653 1.4693 1.5386 1.6105 1.7623 2.0114 5 6 1.0615 1.1262 1.1941 1.4185 1.1449 1.2250 1 3108 1.4026 1.5007 1.6058 1.7182 1.8385 1.9672 1.6771 1.7716 1.9738 23131 6 7 1.0721 1.1487 1.2299 1.3159 1.5869 1.7138 1.8280 1.9487 2.2107 2.6600 7 8 1.0829 1.1717 1.2668 1.3686 1.9926 2.1436 2.4760 3.0590 8 9 1.0937 1.1951 1.4233 1.8509 1.9990 1.3048 1.3439 2.7731 3.5179 9 10 1.1046 1.102 1.1576 1.2155 1.2763 1.3401 1.4071 1.4775 1.5513 1.6289 1.7103 1.7959 1.8856 1.9799 2.0789 2.1829 2.2920 1.2190 1.5036 1.5938 1.6895 1.7908 1.8983 2.0122 2.1329 2.1719 2.3674 2.3579 2.5937 4.0456 10 11 1.1157 1.2434 1.4802 1.5395 1.6010 1.3842 2.1049 2.5804 2.8531 3.1058 3.4785 3.8960 4.6524 11 12 1.1268 1.4258 1.2682 1.2936 2.1589 2.3316 2.5182 2.7196 2.9372 2.2522 5.3503 12 13 1.1381 1.4685 1.6651 2.8127 3.0658 3.3417 3.1384 3.4523 2.4098 4.3635 6.1528 13 14 1.1495 1.3195 1.5126 1.7317 2.2609 2.5785 3.7975 4.8871 7.0757 14 15 1.1610 1.3459 1.5580 1.8009 2.7590 3.1722 3.6425 4.1772 5.4736 2.3966 2.5404 8.1371 15 16 1.1726 1.3728 1.6047 1.8730 2.9522 3.4259 3.9703 4.5950 6.1504 9.3576 16 17 1.1843 1.4002 1.6528 1.9479 2.6928 3.1588 3.7000 4.3276 5.0545 10.7613 17 18 1.1961 1.4282 1.7024 6.8660 7.6900 2.0258 2.8543 3.3799 3.9960 4.7171 12.3755 18 2.4066 2.5270 19 1.2081 1.4568 1.7535 5.5599 6.1159 2.1068 3.0256 3.6165 4.3157 8.6128 14.2318 19 5.1417 5.6044 20 1.2202 1.4859 1.8061 2.1911 2.6533 3.2071 3.8697 4.6610 9.6463 25 6.7275 10.8347 1.6406 2.0938 20 25 4.2919 9alala 5.4274 6.8485 8.6231 1.2824 1.3478 1.4166 2.6658 3.2434 3.3864 - 4.3219 17.0001 29 9599 1.8114 2.4273 5.7435 10.0627 30 35 30 7.6123 10.6766 16.3665 32 9190 66.2118 133 1755 2678635 17.4494 28.1024 1.9999 2.8139 3.9461 7.6861 13.2677 20.4140 31.4094 52.7996 5.5160 7.0400 35 14.7853 21.7245 40 1.4889 2.2080 3.2620 4.8010 10.2857 14.9745 45.2593 93.0510 40 TIT Table B.3 Present Value of an Annuity of 1 p=[1-1/(1+1)"]/i Rate Periods 1% 2% 3% 4% 5% 6% 7% 8% 9% 12% 15% Periods 1 0.9901 0.9804 0.9346 0.9709 1.9135 0.9259 0.9174 0.8929 0.8696 1 2 1.9704 19416 1.6901 10% 0.9091 1.7355 2.4869 3.1699 1.6257 2 3 2.9410 2.8839 0.9615 1.8861 2.7751 3.6299 4.4518 2.8286 2.4018 2.2832 3 4 3.9020 3.8077 1.7591 2.5313 3.2397 3.8897 3.7171 3.0373 2.8550 4 5 4.8534 4.7135 3.7908 3.6048 33522 4.5797 5.4172 5 6 5.7955 5.6014 1.8080 2.6243 3.3872 4.1002 4.7665 5.3893 5.9713 6.5152 7.0236 4.4859 4.3553 4.1114 3.7845 5.2421 6.0021 6 7 6.7282 6.2303 5:0330 4.8684 4.5638 4.1604 7 8 7.6517 6.4720 7.3255 8.1622 5.5348 5.3349 4.9676 4.4873 8 9 8.5660 7.0197 7.7861 8.5302 5.9952 5.7590 5.3282 4.7716 9 10 6.1446 5.6502 5.0188 10 8.9826 9.7868 10.5753 1.7833 2.5771 3.3121 3.9927 4.6229 5.2064 5.7466 6.2469 6.7101 7.1390 7.5361 7.9038 8.2442 8.5595 8.8514 9.1216 9.3719 9.6036 6.4951 0.9524 0.9434 1.8594 1.8334 2.7232 2.6730 3.5460 3.4651 4.3295 4.2124 5.0757 4.9173 5.7864 5.5824 6.4632 6.2098 7.1078 6.8017 7.7217 7.3601 8.3064 7.8869 8.8633 8.3838 9.3936 8.8527 9.8986 9.2950 10.3797 9.7122 10.8378 10.1059 11.2741 10.4773 11.6896 10.8276 12.0853 11.1581 12.4622 11.4699 1 on 9.4713 10.3676 11.2551 12.1337 13.0037 11 12 5.9377 5.2337 6.4177 6.8052 7.1607 11 6.7327 7.4353 8.1109 8.7605 9.3851 9.9856 10.5631 11.1184 11.6523 9.2526 99540 6.1944 5.4206 12 7.4987 7.9427 8.3577 8.7455 6.8137 7.1034 13 7.4869 6.4235 13 11.3484 12.1062 10.6350 11.2961 11.9379 5.5831 5.7245 7.7862 7.3667 6.6282 14 15 14 9.1079 8.0607 5.8474 15 13.8651 14.7179 12.8493 13.5777 7.6061 7.8237 16 12.5611 8.3126 5.9542 16 17 15.5623 14.2919 9.4466 9.7632 10.0591 17 18 13.1661 13.7535 14.3238 14.9920 6.8109 6.9740 7.1196 72497 73658 7.4694 IS 12.1657 12.6593 13.1339 13.5903 16.3983 17.2260 18.0456 8.5436 8.7556 8.9501 9.1285 8.0216 8.2014 8.3619 85156 19 15.6785 16.3514 19 6.0472 6.1280 6.1992 6.2593 CS 10.3356 10.5940 20 14.8775 9.8181 20 11 1071 2.0243 2.71 2.5313 2.4869 3 4 3.9020 3.8077 3.7171 3.6299 2.4018 3.0373 3.5460 3.4651 2.2832 2.8550 3.3872 3.3121 3.2397 3.1699 4 5 4.8534 4.7135 4.5797 4.4518 4.3295 4.2124 4.1002 3.9927 3.8897 3.7908 3.6048 3.3522 5 6 5.7955 5.6014 5.4172 5.2421 4.9173 4.7665 4.6229 4.4859 4.3553 4.1114 3.7845 6 7 5.0757 5.7864 6.7282 6.4720 6.2303 6.0021 5.5824 5.3893 5.2064 5.0330 4.8684 4.1604 7 8 7.6517 7.3255 7.0197 4.5638 4.9676 6.7327 6.2098 5.9713 5.7466 5.5348 5.3349 4.4873 8 9 8.5660 8.1622 7.4353 6.8017 6.5152 6.2469 5.9952 5.7590 5.3282 4.7716 9 7.7861 8.5302 10 6.4632 7.1078 7.7217 8.3064 8.9826 8.1109 6.7101 6.4177 6.1446 5.6502 5.0188 10 11 7.3601 7.8869 7.0236 7.4987 9.7868 9.2526 8.7605 7.1390 6.8052 6.4951 5.9377 11 12 10.5753 5.2337 5.4206 9.9540 9.3851 8.8633 8.3838 7.9427 7.1607 6.1944 12 13 11.3484 9.3936 8.8527 8.3577 6.4235 13 14 12.1062 9.8986 9.2950 8.7455 14 7.5361 7.9038 8.2442 8.5595 8.8514 9.1216 15 5.5831 5.7245 5.8474 5.9542 10.3797 9.7122 15 9.1079 9.4466 16 10.8378 10.1059 9.4713 10.3676 11.2551 12.1337 13.0037 13.8651 14.7179 15.5623 16.3983 17 2260 18.0456 22.0232 25.8077 29.4086 32.8347 74869 7.7862 8.0607 8.3126 8.5436 8.7556 8.9501 16 17 6.6282 6.8109 6.9740 7.1196 7.2497 7.3658 11.2741 10.4773 9.7632 6.0472 17 6.8137 7.1034 .7.3667 7.6061 7.8237 8.0216 8.2014 8.3649 8.5136 9.0770 9.4269 9.6442 9.3719 6.1280 10.6350 9.9856 11.2961 10.5631 11.9379 11 1184 12.5611 11.6523 13.1661 12.1657 13.7535 12.6593 14.3238 13.1339 14.8775 13.5903 17.4131 | 15.6221 19.6004 | 17.2920 21 4872 18.6646 23.1148 19.7928 18 18 19 12.8493 13.5777 14.2919 14.9920 15.6785 16.3514 19.5235 22.3965 24.9986 27-3555 6.1982 19 20 7.4694 6.2593 20 25 11.6896 10.8276 12.0853 11.1581 12.4622 11.4699 14.0939 12.7834 15.3725 13.7648 16.3742 14.4982 17.1591 15.0463 10.0591 10.3356 10.5940 11.6536 12.4090 12 9477 13 3317 6.4641 25 9.6036 9.8181 10.6748 11.2578 11.6546 11.9246 30 9.1285 9.8226 10.2737 10.5668 10.7574 6.5660 30 7.8431 8.0552 8.1755 8.2438 35 6.6166 35 40 9.7791 6.6418 40 IT irad to calculate the na uments made at the end of each period. For example: What is the present value of $2.000 per year for 10 vears assuming an Rate Periods 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 12% 15% Periods 1 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1 1.0000 2.0300 2 2.0100 2.0200 2.0400 2.0500 2.0600 2.0700 2.0800 2.0900 2.1000 2.1200 2.1500 2 3 3.0301 3.0604 3.0909 3.1216 3.1525 3.1836 3.2149 3.2464 3.3100 3.3744 3 3.2781 4.5731 3.4725 4.9934 4 4.0604 4.1216 4.1836 4.2465 4.3101 4.3746 4.4399 4.5061 4.6410 4.7793 4 5 5.1010 5.2040 5.3091 5.4163 5.5256 5.6371 5.7507 5.8666 5.9847 6.1051 6.3528 6.7424 5 6 6.1520 6.3081 6.4684 6.6330 6.8019 6.9753 7.1533 7.3359 7.5233 7.7156 8.1152 8.7537 6 7 7.2135 7.4343 7.6625 7.8983 8.1420 8.3938 8.6540 8.9228 9.2004 9.4872 11.0668 7 8 8.5830 8.8923 9.2142 9.5491 9.8975 10.2598 10.6366 13.7268 8 8.2857 9.3685 9 9.7546 10.1591 10.5828 11.0266 11.4913 11.9780 12.4876 16.7858 10.0890 12.2997 14.7757 17.5487 20.6546 9 10 10.4622 10.9497 11.4639 12.0061 12.5779 13.1808 13.8164 11.0285 13.0210 15.1929 17.5603 20/1407 14.4866 11.4359 13.5795 15.9374 18.5312 21.3843 20.3037 10 11 11.5668 12.1687 13.4864 14.2068 14.9716 15.7836 16.6455 24.3493 11 12.8078 14.1920 12 12.6825 13.4121 15.0258 15.9171 16.8699 17.8885 18.9771 12 24.1331 28.0291 29.0017 34.3519 13 13.8093 14.6803 15.6178 17.7130 21.4953 22.9534 13 20.1406 22.5505 24.5227 27.9750 14 14.9474 15.9739 19.5986 24.2149 26.0192 32.3926 40.5047 14 17.0863 18.5989 15 16.0969 17.2964 21.5786 29 3609 31.7725 37.2797 15 47.5804 17.2579 33.0034 16 18.6393 16 35.9497 55.7175 20.1569 21.7616 23.6575 25.8404 16.6268 18.2919 20.0236 21.8245 23.6975 25.6454 27.6712 29.7781 41.6459 25.1290 27.8881 30.8402 33.9990 18.8821 21.0151 23 2760 25.6725 28.2129 30.9057 33.7600 36.7856 54.8645 17 40.5447 65.0751 18.4304 20.0121 17 36.9737 41.3013 42.7533 48.8837 55.7497 63.4397 18 18 19.6147 27.1521 30.3243 33.7502 37.4502 41.4463 45.7620 173.1059 21.4123 23.4144 20.8109 19 19 2511169 22.8406 37.3790 46.0185 75.8364 88.2118 102.4436 28.1324 3015390 B3.0660 4717271 45.5992 51.1591 57.2750 98.3471 51.1601 72.0524 20 20 22.0190 24.2974 26.8704 40.9955 66.2490 84.7009 133.3339 212.7930 25 25 28.2432 36.4595 32.0303 AL LAMA