question 47

Flexsteel Industries manufactures furniture for the retail, contract, and recreational vehicle furniture markets. Flexsteel is thinking of investing in a new piece of equipment. The cost savings from the equipment would result in an annual increase in cash flow of $115,000. The equipment will have an initial cost of $535,000 and have a 5 -year life. The salvage value of the equipment is estimated to be $84,000. If the hurdle rate is 9%, what is the approximate net present value? Ignore income taxes. (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of \$1.) (Use appropriate factor from the PV tables. Round your final answer to the nearest dollar amount.) Multiple Choice Negative $33,093 Zero Positive $84,000 Positive $535,000