Salsa Company is considering an investment in technology to improve its operations. The investment costs $247,000 and will yield the following net cash flows. Management requires a 7% return on investments. (PV of $1. FV of $1. PVA of $1, and EVA of $1 Note: Use appropriate factor(s) from the tables provided. Year 1 2 3 4 5 Net cash Flow $48,400 53, 100 75,700 94,900 126,900 Required: 1. Determine the payback period for this investment. 2. Determine the break-even time for this investment 3. Determine the net present value for this investment. 4. Should management invest in this project based on net present value? Periods 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 25 30 35 40 2% 1% 3% 5% 6% 7% 8% 9% 10% 12% 0.9901 0.9804 0.9709 0.9615 0.9524 0.9434 0.9346 0.9259 0.9091 0.8929 0.9803 0.9612 0.9426 0.9246 0.9070 0.9174 0.8900 08734 0.8573 08417 0.8264 0.7972 0.8396 0.8163 0.7938 0.7722 0.7513 0.7118 0.7084 0.6830 06355 0.9706 0.9423 09151 08890 0.8638 0.8548 0.8227 0.7835 0.9610 0.9238 0.8885 0.7629 0.7350 0.7921 0.7473 0.4972 0.9515 0.9057 0.8626 0.8219 0.7130 09420 0.8880 08375 0.7903 0.7462 0.7050 0.6663 0.6227 0.6806 0.6499 06209 0.5674 06302 0.5963 0.5645 0.5066 0.4323 06651 0.5835 0.5470 0.5132 04523 0.3759 09235 06274 0.5820 0.5403 0.5019 0.4665 0.4039 0.3269 0.5439 0.5002 0.4604 04241 0.3606 0.2843 0.4224 0.3855 0.3220 0.2472 0.2875 02149 0.3875 0.3505 0.3555 0.3186 0.2567 0.1869 0.3262 0.2897 0.2292 0.1625 0.2992 0.2633 0.2046 0.1413 0.9327 0.8706 08131 0.7599 0.7107 08535 07894 0.7307 0.6768 09143 0.8368 0.7664 0.7026 06446 0.5919 0.9053 0.8203 07441 0.6756 0.6139 0.5584 0.5083 0.4632 0.8963 0.8043 0.7224 0,6496 0.5847 05268 0.4751 0.4289 0.8874 0.7885 07014 0.6246 0.5568 0.4970 04440 0.3971 0.8787 0.7730 06810 06006 0.5303 0.4688 04150 0.3677 0.8700 0.7579 06611 0.5775 0 5051 0.4423 0.3878 0.3405 08613 0.7430 06419 0.5553 0.4810 0.4173 0.3624 0.3152 08528 0.7284 0.6232 0.5339 04581 0.3936 0.3387 0.2919 0.2519 08444 0.7142 0.6050 05134 0,4363 03714 0.3166 0.2703 02311 08360 0.7002 0.5874 04936 04155 0.3503 0.2959 02502 08277 0.6864 05703 04746 0.3957 0.3305 08195 06730 0.5537 04564 0.3769 03118 0.6095 0.4776 0.3751 02953 02330 0.4120 0.3083 02314 02534 0.1813 0.1827 01229 0.2745 0.2394 0.2176 0.1631 0.1069 02317 0.2765 02584 02145 07796 0.1842 0.1460 07419 0.5521 01314 0.00904 01741 0.1301 0.7059 0.5000 03554 0.0937 00676 06717 04529 03066 02083 01420 00972 00668 0.0460 15% 0.8696 0.7561 0.6575 0.5718 0.1978 0.1456 0.0929 0:1799 01300 0.0808 02120 0.1945 01635 0.1161 0.0703 0.1784 014086 0.1037 0.0611 0.1160 0.0923 0.0588 0.0304 0.0754 0.0573 0.0334 0.0151 0.0490 00356 0.0189 0.0075 0.0318 0.0221 00107 0.0037 Periods 1 35 PARAS=2223829 10 11 20 25 13 14 12 15 17 6769 4 2 3 "Used to compute the present value of a known future amount. For example How much would you need to invest today ar 10% compounded semiannually to accumulate $5,000 in 6 wears semiannual rate of the p Periods 1% 0 1 2 3 4 3% 4% 5% 6% 7% 8% 9% 10% 15% 2% 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.1000 1.1200 1.1500 1.2100 1.2544 1.3225 1.3310 1.4049 1.5209 1.0406 1.0824 1.3605 1.4116 1.4641 1.5735 1.7490 1.4693 1.5386 1.6105 1.7623 20114 2.3131 8 9 10 11 1.0000 1.0100 1.0200 1.0300 1.0400 1.0500 1.0600 1.0700 1.0800 1.0900 1.0201 1.0404 1.0609 1.0816 1,1025 1.1236 1.1449 1.1664 1.1881 1.0303 1.0612 1.0927 1.1249 1.1576 1.1910 1.2250 1.2597 1.2950 1.1255 1.1699 1.2155 1.2625 1.3108 1.0510 1.1041 1 1593 1.2167 1.2763 1.3382 1.4026 1.0615 1.1262 1.1941 1.2653 1.3401 14185 1.5007 1.5869 1.6771 1.7716 1.9738 1.0721 1.1487 1.2299 1.3159 1.4071 1.5036 1.6058 1.7138 1.8280 1.9487 2.2107 2.6600 1.0829 1.1717 1.2668 1.3686 1.4775 1.5938 1.7182 1.8509 1.9926 2.1436 2.4760 3.0590 1.0937 1.1951 1,3048 1.4233 1.5513 1.6895 1.8385 1.9990 2.1719 2.3579 2.7731 3.5179 1.1046 1.2190 13439 1.4802 1.6289 1.7908 1.9672 2.1589 2.3674 2.5937 3.1058 4.0456 1.1157 12434 13842 1.5395 1.7103 1.8983 2.1049 2.3316 2,5804 2.8531 34785 4.6524 1.1268 1.2682 1.4258 1.6010 1.7959 20122 2.2522 2.5182 2.8127 3.1384 3.8960 5.3503 1.1381 1.2936 14685 1.6651 1.8856 2.1329 2.4098 2.7196 3.0658 3.4523 4.3635 6.1528 1.7317 1.9799 2.2609 2.5785 2.9372 3.3417 3.7975 4.8871 7.0757 11610 1.3459 1.5580 1.8009 2.0789 23966 2.7590 3.1722 36425 4.1772 5.4736 1.1726 1.3728 1.6047 1.8730 2.1829 2 5404 2.9522 3.4259 3.9703 4.5950 6.1304 16 1,1843 1.4002 1.6528 19479 2.2920 2.6928 3.1588 3.7000 4.3276 5:0545 6.8660 10.7613 17 1.7024 2.0258 2.4066 28543 3.3799 3.9960 4,7171 5.5599 7.6900 12.3755 1.7535 2.1068 2.5270 3.0256 3.6165 6.1159 1.8061 2.1911 2.6533 3.2071 3.8697 4.6610 5.6044 6.7275 2.0938 26658 3.3864 4.2919 54274 6.8485 8.6231 10 8347 2.4273 5.7435 7.6123 10.0627 13.2677 17.4494 1.9999 28139 3.9461 5.5160 7.6661 10.6766 14.7853 20.4140 28 1024 14889 22080 32620 48010 70400 10.2857 14.9745 21.7245 31.4094 45 2593 Used to compute the future value of a known present amount Formal Wherenak 12 13 1,1495 1.3195 1.5126 14 8.1371 15 9.3576 1.1961 14282 12081 14568 18 43157 5.1417 8.6128 14.2318 9.6463 16.3665 1.2202 1.4859 1.6406 18114 17.0001 25 1.2824 13478 35 14166 32.9190 3.2434 4.3219 29.9599 66 2118 5 6 7 8 9 10 11 12 13 14 15 16 17 18 282829 19 20 30 Rate 40 12% 1.0000 52.7996 133.1755 93.0510 267.8635 283849 19 20 25 30 Periods 0 35 40 1 2 3456 7 Table B.3 Present Value of an Annuity of 1 p=11-1/(1+i) Rate 15% 6% 7% 8% 9% 12% 1% 2% 0.9434 0.9346 0.9259 0.8696 0.9174 0.8929 0.9901 09804 1.8080 1.7833 1.7591 1.6901 1.8334 1.6257 2.4869 2.4018 2.2832 1.9704 1.9416 2.9410 2.8839 2.8286 2.7751 3.6299 2.6730 2.6243 3.9020 3.8077 3.7171 3.4651 3.3872 3.3121 3.9927 3.1699 3.0373 2.8550 3.3522 4.8534 4.7135 4.5797 4.4518 4.2124 4.1002 5.7955 5.6014 5.4172 5.2421 49173 6,7282 6.4720 6.2303 6.0021 5.7864 5.5824 7.6517 7:3255 6.2098 8.5660 8.1622 7,0197 6.7327 6.4632 7.7861 7.4353 7.1078 8.5302 8.1109 7.7217 2.5771 2.5313 3.2397 3.8897 3.7908 3.6048 4.7665 4.6229 4.4859 4.3553 4.1114 3.7845 5,3893 5.2064 5.0330 4.8684 4.5638 4.1604 5.9713 5.7466 5.5348 5.3349 4.9676 4.4873 6.5152 6.2469 5.9952 5.7590 5.3282 4.7716 7.0236 6.7101 6.4177 6.1446 5.6502 5.0188 7.4987 7.1390 6.8052 6.4951 5.9377 5.2337 7.1607 6.8137 6.1944 5.4206 7.4869 7.1034 6.4235 5.5831 7.7862 7.3667 6.6282 5.7245 5.8474 6.8017 7.3601 9.2526 8.7605 8.3064 7.8869 9.4713 8.9826 7.9427 7.5361 7.9038 8.2442 10.3676 9.7868 11.2551 10.5753 9.9540 9.3851 8.8633 8.3838 12. 1337 11.3484 10.6350 9.9856 9.3936 8.8527 8.3577 13.0037 12.1062 11.2961 10.5631 9.8986 9.2950 8.7455 13.8651 12.8493 11.9379 111184 10.3797 9.7122 9.1079 14.7179 13.5777 12.5611 11.6523 10.8378 10.1059 9.4466 15.5623 142919 13.1661 12.1657 11 2741 10.4773 16.3983 14.9920 13.7535 12.6593 11.6896 10 8276 8.5595 8.8514 8.0607 7.6061 6.8109 8.3126 7.8237 6.9740 5.9542 9.1216 6.0472 6,1280 9.3719 8.5436 8.0216 7.1196 7.2497 7.3658 6.1982 11.1581 10 3356 8,7556 8.2014 8.9501 8.3649 9.1285 8.5136 9.6036 9.8181 7.4694 6.2593 9.0770 7.8431 6.4641 17.2260 15.6785 14.3238 13.1339 12 0853 18.0456 16.3514 14.8775 13.5903 12 4622 11,4699 10.5940 22.0232 19.5235 17 4131 15.6221 14.0939 12.7834 11.6536 25.8077 22.3965 19 6004 17 2920 15.3725 13.7648 12 4090 29.4056 249956 21.4872 18.6646 16.3742 14 4982 129477 11.6546 32 8347 27 3555 23 1148 19.7928 17.1591 150463 Used to calculate the present value of a series of equal pave 10.6748 11 2578 8.0552 6.5660 9.8226 10.2737 94269 10.5668 10.7574 9.7791 9.6442 8.1755 6.6166 13 3317 11.9246 8.2438 6.6418 Periods 1 2 3 4 S 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 25 30 35 40 4% 5% 0.9615 0.9524 1.9135 1.8861 1.8594 2.7232 3.5460 3% 0.9709 4.3295 5.0757 9.7632 10.0591 10% 0.5091 1.7355 14 15 16 17. 18 19 20 23839 25 30 35 Periods 1 2 40 3 4 5 8 9 10 11 12 13 6 7 Table B.4 Fut f-1(1+)-11/ Periods 1% 1 2 3 3.0301 3% 2% 4% 5% 6% 7% 10% 15% 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 2.0100 2.0200 2.0300 2.0400 2.0500 2.0600 2.0700 2.1000 2.1200 2.1500 3.0604 3.0909 3.1216 3.1525 3.1836 3.2781 3.3100 3.3744 3.4725 4.0604 4.1216 4.1836 4.2465 4.3101 4.3746 4.5061 4.5731 4.6410 4.7793 4.9934 5.1010 5.2040 5.3091 5.4163 5.5256 5.6371 5.8666 5.9847 6.1051 6.3528 6.7424 6.1520 6.3081 6.4684 6.6330 6.8019 6.9753 7.3359 7.5233 7.7156 8.1152 8.7537 7.2135 7.4343 7.6625 7.8983 8.1420 8.3938 8.6540 8.9228 9.2004 9.4872 10.0890 11.0668 8.2857 8.5830 8.8923 9.8975 10.2598 10.6366 11.0285 11.4359 12.2997 13.7268 9.2142 9.5491 11.0266 9.3685 9.7546 10.1591 10.5828 11.4913 11.9780 12.4876 13.0210 13,5795 14.7757 16.7858 14.4866 15.1929 15.9374 17.5487 20.3037 16.6455 17.5603 18.5312 20.6546 24.3493 10.4622 10.9497 11.4639 12.0061 12.5779 13.1808 13.8164 11.5668 12.1687 12.8078 13.4864 14.2068 14.9716 15.7836 12.6825 13.4121 14.1920 15.0258 15.9171 16.8699 17.8885 13.8093 14.6803 15.6178 16.6268 17.7130 18.8821 20.1406 14.9474 15.9739 17.0863 18.2919 19.5986 21.0151 22.5505 16.0969 17.2934 18.5989 20.0236 21.5786 23 2760 25.1290 17.2579 18.6393 20.1569 21.8245 23.6575 25.6725 27.8881 18.4304 20 0121 21.7616 23.6975 25.8404 28.2129 30.8402 19.6147 21.4123 23.4144 25.6454 28.1324 30.9057 33.9990 20.8109 22 8406 25.1169 27,6712 30.5390 33.7600 37.3790 41.4463 46.0185 51.1591 63.4397 88 2118 22.0190 24.2974 26 8704 29.7781 33.0660 36.7856 40.9955 45.7620 51.1601 57.2750 72.0524 102.4436 28.2432 32.0303 36.4593 41.6459 47.7271 54.8645 63.2490 73.1059 84.7009 98.3471 133.3339 212.7930 34.7849 40.5681 47.5754 56.0849 66.4388 79.0582 94.4608 113.2832 136.3075 164.4940 241.3327 434.7451 73.6522 90 3203 111.4348 138.2369 172 3168 215.7108 271.0244 431.6635 881 1702 95.0255 120.7998 154.7620 199.6351 250.0565 337.8824 442 5926 767.0914 1,779.0903 18.9771 20.1407 21.3843 24.1331 29.0017 21.4953 22.9534 24.5227 28.0291 34.3519 24.2149 26.0192 27.9750 32.3926 40.5047 27.1521 29.3609 31.7725 37.2797 47.5804 30.3243 33.0034 35.9497 42.7533 55.7175 33.7502 36.9737 40.5447 48.8837 65.0751 37.4502 41.3013 45.5992 55.7497 75.8364 41.6603 49.9945 60 4621 48 8864 60 4020 75.4013 Used to calculate the future value of a c MAR 456 7 8 9 10 Future Value of an Annuity of 1 11 12 13 14 15 16 17 18. 19 20 25 30 35 40 Rate 8% 9% 1.0000 1.0000 2.0800 2.0900 3.2149 3.2464 4.4399 5,7507 7.1533 12% 1.0000 20 25 30 35 Periods 1 40 2 3 4 12 13 14 15 16 17 18 19 EASONS 10