Quary Company is considering an investment in machinery with the following information. The companys required rate of return is 14%. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Initial investment $ 304,000 Materials, labor, and overhead (except depreciation) $ 60,000 Useful life 9 years DepreciationMachinery 30,400 Salvage value $ 30,400 Selling, general, and administrative expenses 20,000 Expected sales per year 12,000 units Selling price per unit $ 13 a. Compute the investments net present value. b. Using the answer from part a, is the investments internal rate of return higher or lower than 14%?

• Required B

Compute the investments net present value. (Negative net present values should be indicated with a minus sign. Round your present value factor to 4 decimals. Round your answers to the nearest whole dollar.)

	Net Cash Flows	x	Present Value	=	Present Value of Net Cash Flows
Years 1-9				=
Year 9 salvage				=
Totals					$0

Using the answer from part a, is the investments internal rate of return higher or lower than 14%? Hint: It is not necessary to compute the IRR to answer this question.

Is the internal rate of return higher or lower than 14%?

• Required A