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Pina Company is considering purchasing equipment. The equipment will produce the following cash inflows: Year 1,22,000 Year 2 27,000; and Year 3. $37,000. Pina requires
Pina Company is considering purchasing equipment. The equipment will produce the following cash inflows: Year 1,22,000 Year 2 27,000; and Year 3. $37,000. Pina requires a minimum rate of return of 7%. What is the maximum price Pina should pay for this equipment? (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) (Round answer to 2 decimal places, es 5.275,50) To determine the present value of the future cash flows, discount the future cash flows at 7%, using Table 3. Click here to view the factor table. Year 1 $ Year 2 Year 3 Present value of future cash flows 3
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