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Perit Industries has $115,000 to invest. The company is trying to decide between two alternative uses of the funds. The alternatives are:Cost of equipment required
Perit Industries has $115,000 to invest. The company is trying to decide between two alternative uses of the funds. The alternatives are:Cost of equipment required $ 115,000 $ 0 Working capital investment required $ 0 $ 115,000 Annual cash inflows $ 21,000 $ 69,000 Salvage value of equipment in six years $ 8,700 $ 0 Life. The working capital needed for project B will be released at the end of six years for investment elsewhere. Perit Industries discount rate is 15%.
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