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Rundle Company is considering investing in two new vans that are expected to generate combined cash inflows of $ 2 8 , 5 0 0

Rundle Company is considering investing in two new vans that are expected to generate combined cash inflows of $28,500 per year.
The vans' combined purchase price is $90,500. The expected life and salvage value of each are five years and $20,700, respectively.
Rundle has an average cost of capital of 12 percent. (PV of $1 and PVA of $1)
Note: Use appropriate factor(s) from the tables provided.
Required
a. Calculate the net present value of the investment opportunity.
Note: Negative amount should be indicated by a minus sign. Round your intermediate calculations and final answer to 2
decimal places.
b. Indicate whether the investment opportunity is expected to earn a return that is ABOVE or BELOW the cost of capital and whether it
should be ACCEPTED or REJECTED.
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