Perit Industries has $155,000 to invest. The company is trying to decide between two alternative uses of the funds. The alternatives are: Cost of equipment required Working capital investment required Annual cash Salvage value of equipment in six years Tife of the project Project $155,000 $ $ 25,000 $ 6 years Project B $ 155,000 $40,000 6 years The working capital needed for project B will be released at the end of six years for investment elsewhere. Perit industries' discount rate is 14%

Perit Industries has $155,000 to invest. The company is trying to decide between two alternative uses of the funds. The alternatives are: Cost of equipment required Working capital investment required Annual cash inflows Salvage value of equipment in six years Tife of the project Project $ 155,000 $ 0 $ 25,000 $ 8.600 6 years Project B $ 0 $155,000 $40,000 $ 0 6 years The working capital needed for project will be released at the end of six years for investment elsewhere. Perit Industries' discount rate is 14% Click here to view Exhibit 138.1 and Exhibit 138-2, to determine the appropriate discount factor(s) using tables. Required: 1. Compute the net present value of Project A. (Enter negative values with a minus sign. Round your final answer to the nearest whole dollar amount.) 2. Compute the net present value of Project B. (Enter negative values with a minus sign. Round your final answer to the nearest whole dollar amount.) 3. Which investment alternative (if either would you recommend that the company accept? 1. Net present value project A 2. Net present value project B Which investment alternative (either) would you recommend that the company accept