Question
QUESTION 4 [6 MARKS] A project requires an initial investment of P500,000. The following cash flows have been estimated for the life of the project:
QUESTION 4 [6 MARKS]
A project requires an initial investment of P500,000. The following cash flows have been
estimated for the life of the project:
Year Cash flow (P)
1 120,000
2 150 000
3 180 000
4 160 000
a. The company uses NPV to appraise projects. Using a discount rate of 7%, calculate the NPV
of the project and recommend whether the project should be undertaken. (6 marks)
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Accounting Information Systems
Authors: Pat Wheeler, Ulric J Gelinas, Richard B Dull
9th Edition
0538469315, 9780538469319
