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Pharoah, Inc. is considering the purchase ofa warehouse directly across the street from its manufacturing plant. Pharoah currently warehouses its inventory in a public warehouse
Pharoah, Inc. is considering the purchase ofa warehouse directly across the street from its manufacturing plant. Pharoah currently warehouses its inventory in a public warehouse across town. Rent on the warehouse and delivering and picking up inventory cost Pharoah $53760 per year. The building will cost Pharoah $504000. Pharoah will depreciate the building for 20 years. At the end of 20 yea rs, the building will have a $140000 salvage value. Pharoah's required rate of return is 12%. Click here to view the factor table. Using the present value tables, the building's net present value is [round to the nearest dollar} 0 $416073. 0 $87927. O $48685. Cl $1075200
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