Sydra's Bakery plans to purchase a new oven for its store. The oven has an estimated useful life of 4 years. The estimated pretax cash flows for the oven are as shown in the table that follows, with no anticipated change in working capital. Sydra's Bakery has a 12% after-tax required rate of return and a 40% income tax rate. Assume depreciation is calculated on a straight-line basis for tax purposes using the initial investment in the oven and its estimated terminal disposal value. Assume all cash flows occur at year-end except for initial investment amounts. (Click the icon to view the estimated cash flows for the oven.) Present Value of $1 table Present Value of Annuity of $1 table Future Value of $1 table Future Value of Annuity of $1 table Read the requirements. Requirement 1. Calculate (a) net present value, (b) payback period, and (c) internal rate of return. a. Net present value. (Use factors to three decimal places, X.XXX. Round intermediary calculations and your final answer to the nearest whole dollar.) The net present value is i Data Table A B D E F 1 Relevant Cash Flows at End of Each Year 2 Year 0 Year 1 Year 2 Year 3 Year 4 $ (88,000) 3 Initial oven investment Annual cash flows from operations 4 (excluding the depreciation effect) 5 Cash flow from terminal disposal of oven $ 36,000 $ 36,000 $ 36,000 $ 36,000 $ 8,000 Print Done Reference X 32% Present Value of $1 Periods 2% 4% Period 1 0.980 0.962 Period 2 0.961 0.925 Period 3 0.942 0.889 Period 4 0.924 0.855 Period 5 0.906 0.822 Period 6 0.888 0.790 Period 7 0.871 0.760 Period 8 0.853 0.731 Period 9 0.837 0.703 Period 10 0.820 0.676 Period 11 0.804 0.650 Period 12 0.788 0.625 Period 13 0.773 0.601 Period 14 0.758 0.577 Period 15 0.743 0.555 Period 16 0.728 0.534 Period 17 0.714 0.513 Period 18 0.700 0.494 Period 19 0.686 0.475 Period 20 0.673 0.456 Period 21 0.660 0.439 Period 22 0.647 0.422 Period 23 0.634 0.406 Period 24 0.622 0.390 Period 25 0.610 0.375 Period 26 0.598 0.361 Period 27 0.586 0.347 6% 0.943 0.890 0.840 0.792 0.747 0.705 0.665 0.627 0.592 0.558 0.527 0.497 0.469 0.442 0.417 0.394 0.371 0.350 0.331 0.312 0.294 0.278 0.262 0.247 0.233 0.220 0.207 8% 0.926 0.857 0.794 0.735 0.681 0.630 0.583 0.540 0.500 0.463 0.429 0.397 0.368 0.340 0.315 0.292 0.270 0.250 0.232 0.215 0.199 0.184 0.170 0.158 0.146 0.135 0.125 10% 0.909 0.826 0.751 0.683 0.621 0.564 0.513 0.467 0.424 0.386 0.350 0.319 0.290 0.263 0.239 0.218 0.198 0.180 0.164 0.149 0.135 0.123 0.112 0.102 0.092 0.084 0.076 12% 0.893 0.797 0.712 0.636 0.567 0.507 0.452 0.404 0.361 0.322 0.287 0.257 0.229 0.205 0.183 0.163 0.146 0.130 0.116 0.104 0.093 0.083 0.074 0.066 0.059 0.053 0.047 14% 0.877 0.769 0.675 0.592 0.519 0.456 0.400 0.351 0.308 0.270 0.237 0.208 0.182 0.160 0.140 0.123 0.108 0.095 0.083 0.073 0.064 0.056 0.049 0.043 16% 0.862 0.743 0.641 0.552 0.476 0.410 0.354 0.305 0.263 0.227 0.195 0.168 0.145 0.125 0.108 0.093 0.080 0.069 0.060 0.051 0.044 0.038 0.033 0.028 0.024 0.021 0.018 18% 0.847 0.718 0.609 0.516 0.437 0.370 0.314 0.266 0.225 0.191 0.162 0.137 0.116 0.099 0.084 0.071 0.060 0.051 0.043 0.037 0.031 0.026 0.022 0.019 0.016 0.014 0.011 20% 0.833 0.694 0.579 0.482 0.402 0.335 0.279 0.233 0.194 0.162 0.135 0.112 0.093 0.078 0.065 0.054 0.045 0.038 0.031 0.026 0.022 0.018 0.015 0.013 0.010 0.009 0.007 22% 0.820 0.672 0.551 0.451 0.370 0.303 0.249 0.204 0.167 0.137 0.112 0.092 0.075 0.062 0.051 0.042 0.034 0.028 0.023 0.019 0.015 0.013 0.010 0.008 0.007 0.006 0.005 24% 0.806 0.650 0.524 0.423 0.341 0.275 0.222 0.179 0.144 0.116 0.094 0.076 0.061 0.049 0.040 0.032 0.026 0.021 0.017 0.014 0.011 0.009 0.007 0.006 0.005 0.004 0.003 26% 0.794 0.630 0.500 0.397 0.315 0.250 0.198 0.157 0.125 0.099 0.079 0.062 0.050 0.039 0.031 0.025 0.020 0.016 0.012 0.010 0.008 0.006 0.005 0.004 0.003 0.002 0.002 28% 30% 0.781 0.769 0.610 0.592 0.477 0.455 0.373 0.350 0.291 0.269 0.227 0.207 0.178 0.159 0.139 0.123 0.108 0.094 0.085 0.073 0.066 0.056 0.052 0.043 0.040 0.033 0.032 0.025 0.025 0.020 0.019 0.015 0.015 0.012 0.012 0.009 0.009 0.007 0.007 0.005 0.006 0.004 0.004 0.003 0.003 0.002 0.003 0.002 0.002 0.001 0.002 0.001 0.001 0.001 0.758 0.574 0.435 0.329 0.250 0.189 0.143 0.108 0.082 0.062 0.047 0.036 0.027 0.021 0.016 0.012 0.009 0.007 0.005 0.004 0.003 0.002 0.002 0.001 0.001 0.001 0.001 40% Periods 0.714 Period 1 0.510 Period 2 0.364 Period 3 0.260 Period 4 0.186 Period 5 0.133 Period 6 0.095 Period 7 0.068 Period 8 0.048 Period 9 0.035 Period 10 0.025 Period 11 0.018 Period 12 0.013 Period 13 0.009 Period 14 0.006 Period 15 0.005 Period 16 0.003 Period 17 0.002 Period 18 0.002 Period 19 0.001 Period 20 0.001 Period 21 0.001 Period 22 0.000 Period 23 0.000 Period 24 0.000 Period 25 0.000 Period 26 0.000 Period 27 0.038 0.033 0.029 Print Done i Reference 16% 0.862 1.605 2.246 2.798 3.274 Present Value of Annuity of $1.00 in Arrears* Periods 2% 4% 6% 8% 10% 12% Period 1 0.980 0.962 0.943 0.926 0.909 0.893 Period 2 1.942 1.886 1.833 1.783 1.736 1.690 Period 3 2.884 2.775 2.673 2.577 2.487 2.402 Period 4 3.808 3.630 3.465 3.312 3.170 3.037 Period 5 4.713 4.452 4.212 3.993 3.791 3.605 Period 6 5.601 5.242 4.917 4.623 4.355 4.111 Period 7 6.472 6.002 5.582 5.206 4.868 4.564 Period 8 7.325 6.733 6.210 5.747 5.335 4.968 Period 9 8.162 7.435 6.802 6.247 5.759 5.328 Period 10 8.983 8.111 7.360 6.710 6.145 5.650 Period 11 9.787 8.760 7.887 7.139 6.495 5.938 Period 12 10.575 9.385 8.384 7.536 6.814 6.194 Period 13 11.348 9.986 8.853 7.904 7.103 6.424 Period 14 12.106 10.563 9.295 8.244 7.367 6.628 Period 15 12.849 11.118 9.712 8.559 7.606 6.811 Period 16 13.578 11.652 10.106 8.851 7.824 6.974 Period 17 14.292 12.166 10.477 9.122 8.022 7.120 Period 18 14.992 12.659 10.828 9.372 8.201 7.250 Period 19 15.678 13.134 11.158 9.604 8.365 7.366 Period 20 16.351 13.590 11.470 9.818 8.514 7.469 Period 21 17.011 14.029 11.764 10.017 8.649 7.562 Period 22 17.658 14.451 12.042 10.201 8.772 7.645 Period 23 18.292 14.857 12.303 12.303 10.371 8.883 7.718 Period 24 18.914 15.247 12.550 10.529 8.985 7.784 Period 25 19.523 15.622 12.783 10.675 9.077 7.843 Period 26 20.121 15.983 13.003 10.810 9.161 7.896 Period 27 20.707 16.330 13.211 10.935 9.237 7.943 14% 0.877 1.647 2.322 2.914 3.433 3.889 4.288 4.639 4.946 5.216 5.453 5.660 5.842 6.002 6.142 6.265 6.373 6.467 6.550 6.623 6.687 6.743 6.792 6.835 6.873 6.906 6.935 3.685 4.039 4.344 4.607 4.833 5.029 5.197 5.342 5.468 5.575 5.668 5.749 5.818 5.877 5.929 18% 0.847 1.566 2.174 2.690 3.127 3.498 3.812 4.078 4.303 4.494 4.656 4.793 4.910 5.008 5.092 5.162 5.222 5.273 5.316 5.353 5.384 5.410 5.432 5.451 5.467 5.480 5.492 20% 0.833 1.528 2.106 2.589 2.991 3.326 3.605 3.837 4.031 4.192 4.327 4.439 4.533 4.611 4.675 4.730 4.775 4.812 4.843 4.870 4.891 4.909 4.925 4.937 4.948 4.956 4.964 22% 0.820 1.492 2.042 2.494 2.864 3.167 3.416 3.619 3.786 3.923 4.035 4.127 4.203 4.265 4.315 4.357 4.391 4.419 4.442 4.460 4.476 4.488 4,499 4.507 4.514 4.520 4.524 24% 0.806 1.457 1.981 2.404 2.745 3.020 3.242 3,421 3.566 3.682 3.776 3.851 3.912 3.962 4.001 4.033 4.059 4.080 4.097 4.110 4.121 4.130 4.137 4.143 4.147 4.151 4.154 26% 0.794 1.424 1.923 2.320 2.635 2.885 3.083 3.241 3.366 3.465 3.543 3.606 3.656 3.695 3.726 3.751 3.771 3.786 3.799 3.808 3.816 3.822 3.827 3.831 3.834 3.837 3.839 28% 30% 0.781 0.769 1.392 1.361 1.868 1.816 2.241 2.166 2.532 2.436 2.759 2.643 2.937 2.802 3.076 2.925 3.184 3.019 3.269 3.092 3.335 3.147 3.387 3.190 3.427 3.223 3.459 3.249 3.483 3.268 3.503 3.283 3.518 3.295 3.529 3.304 3.539 3.311 3.546 3.316 3.551 3.320 3.556 3.323 3.559 3.325 3.562 3.327 3.564 3.329 3.566 3.330 3.567 3.331 32% 0.758 1.331 1.766 2.096 2.345 2.534 2.677 2.786 2.868 2.930 2.978 3.013 3.040 3.061 3.076 3.088 3.097 3.104 3.109 3.113 3.116 3.118 3.120 3.121 3.122 3.123 3.123 40% Periods 0.714 Period 1 1.224 Period 2 1.589 Period 3 1.849 Period 4 2.035 Period 5 2.168 Period 6 2.263 Period 7 2.331 Period 8 2.379 Period 9 2.414 Period 10 2.438 Period 11 2.456 Period 12 2.469 Period 13 2.478 Period 14 2.484 Period 15 2.489 Period 16 2.492 Period 17 2.494 Period 18 2.496 Period 19 2.497 Period 20 2.498 Period 21 2.498 Period 22 2.499 Period 23 2.499 Period 24 2.499 Period 25 2.500 Period 26 2.500 Period 27 5.973 6.011 6.044 6.073 6.097 6.118 6.136 Print Done Reference 14% 20% 1.200 1.440 1.728 2.074 2.488 2.986 3.583 4.300 5.160 6.192 7.430 8.916 Compound Amount of $1.00 (The Future Value of $1.00) Periods 2% 4% 6% 8% 10% 12% Period 1 1.020 1.040 1.060 1.080 1.100 1.120 1.140 Period 2 1.040 1.082 1.124 1.166 1.210 1.254 1.300 Period 3 1.061 1.125 1.191 1.260 1.331 1.405 1.482 Period 4 1.082 1.170 1.262 1.360 1.464 1.574 1.689 Period 5 1.104 1.217 1.338 1.469 1.611 1.762 1.925 Perlod 6 1.126 1.265 1.419 1.587 1.772 1.974 2.195 Perlod 7 1.149 1.316 1.504 1.714 1.949 2.211 2.502 Period 8 1.172 1.369 1.594 1.851 2.144 2.476 2.853 Period 9 1.195 1.423 1.689 1.999 2.358 2.773 3.252 Period 10 1.219 1.480 1.791 2.159 2.594 3.106 3.707 Period 11 1.243 1.539 1.898 2.332 2.853 3.479 4.226 Period 12 1.268 1.601 2.012 2.518 3.138 3.896 4.818 Period 13 1.294 1.665 2.133 2.720 3.452 4.363 5.492 Period 14 1.319 1.732 2.261 2.937 3.797 4.887 6.261 Period 15 1.346 1.801 2.397 3.172 4.177 5.474 7.138 Period 16 1.373 1.873 2.540 3.426 4.595 6.130 8.137 Period 17 1.400 1.948 2.693 3.700 5.054 6.866 9.276 Period 18 1.428 2.026 2.854 3.996 5.560 7.690 10.575 Period 19 1.457 2.107 3.026 4.316 6.116 8.613 12.056 Period 20 1.486 2.191 3.207 4.661 6.727 9.646 13.743 Period 21 1.516 2.279 3.400 5.034 7.400 10.804 15.668 Period 22 1.546 2.370 3.604 5.437 8.140 12.100 17.861 Period 23 1.577 2.465 3.820 5.871 8.954 13.552 13.552 20.362 Period 24 1.608 2.563 4.049 6.341 9.850 15.179 23.212 Period 25 1.641 2.666 4.292 6.848 10.835 17.000 26.462 Period 26 1.673 2.772 4.549 7.396 11.918 19.040 30.167 Period 27 1.707 2.883 4.822 7.988 13.110 21.325 34.390 16% 1.160 1.346 1.561 1.811 2.100 2.436 2.826 3.278 3.803 4.411 5.117 5.936 6.886 7.988 9.266 10.748 12.468 14.463 16.777 19.461 22.574 26.186 30.376 35.236 40.874 47.414 55.000 18% 1.180 1.392 1.643 1.939 2.288 2.700 3.185 3.759 4.435 5.234 6.176 7.288 8.599 10.147 11.974 14.129 16.672 19.673 23.214 27.393 32.324 38.142 45.008 53.109 62.669 73.949 87.260 10.699 12.839 15.407 18.488 22.186 26.623 31.948 38.338 46.005 55.206 66.247 79.497 95.396 114.475 137.371 22% 1.220 1.488 1.816 2.215 2.703 3.297 4.023 4.908 5.987 7.305 8.912 10.872 13.264 16.182 19.742 24.086 29.384 35.849 43.736 53.358 65,096 79.418 96.889 118.205 144.210 175.936 214.642 24% 1.240 1.53B 1.907 2.364 2.932 3.635 4.508 5.590 6.931 8.594 10.657 13.215 16.386 20.319 25.196 31.243 38.741 48.039 59.568 73.864 91.592 113.574 140.831 174.631 216.542 268.512 332.955 26% 1.260 1.588 2.000 2.520 3.176 4.002 5.042 6.353 8.005 10.086 12.708 16.012 20.175 25.421 32.030 40.358 50.851 64.072 80.731 101.721 128.169 161.492 203.480 256.385 323.045 407.037 512.887 28% 1.280 1.638 2.097 2.684 3.436 4.398 5.629 7.206 9.223 11.806 15.112 19.343 24.759 31.691 40.565 51.923 66.461 85.071 108.890 139.380 178.406 228.360 292.300 374.144 478.905 612.998 784.638 30% 1.300 1.690 2.197 2.856 3.713 4.827 6.275 8.157 10.604 13.786 17.922 23.298 30.288 39.374 51.186 66.542 86.504 112.455 146.192 190.050 247.065 321.184 417.539 542.801 705.641 917.333 1192.533 32% 1.320 1.742 2.300 3.036 4.007 5.290 6.983 9.217 12.166 16.060 21.199 27.983 36.937 48.757 64.359 84.954 112.139 148.024 195.391 257.916 340.449 449.393 593.199 783.023 1033.590 1384.339 1800.927 40% 1.400 1.980 2.744 3.842 5.378 7.530 10.541 14.758 20.661 28.925 40.496 56.694 79.371 111.120 155.568 217.795 304.913 426.879 597.630 836.683 1171.356 1639.898 2295.857 3214.200 4499.880 6299.831 8819.764 Periods Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Perlod 8 Period 9 Period 10 Period 11 Period 12 Period 13 Period 14 Period 15 Period 16 Period 17 Period 18 Period 19 Period 20 Period 21 Period 22 Period 23 Period 24 Period 25 Period 26 Period 22 Print Done Reference Compound Amount of Annuity of $1.00 in Arrears* (Future Value of Annuity) Periods 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% Period 1 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Period 22.020 2.040 2.060 2.080 2.100 2.120 2.140 2.160 2.180 2.200 Period 3 3.060 3.122 3.184 3.246 3.310 3.374 3.440 3.506 3.572 3.640 Period 4 4.122 4.248 4.375 4.508 4.641 4.779 4.921 5.068 5.215 5.368 Period 5 5.204 5.416 5,637 5.867 6.105 6.353 6.610 6.877 7.154 7.442 Period 6 6.308 6.633 6.975 6.975 7.336 7.716 8.115 8.536 8.977 9.442 9.930 Period 7 7.434 7.898 8.394 8.923 9.487 10.089 10.730 11.414 12.142 12.916 Period 8 8.583 9.214 9.897 10.637 11.436 12.300 13.233 14.240 15.327 16.499 Period 9 9.755 10.583 11.491 12.488 13.579 14.776 16.085 17.519 19.086 20.799 Period 10 10.950 12.006 13.181 14.487 15.937 17.549 19.337 21.321 23.521 25,959 Period 11 12.169 13.486 14.972 16.645 18.531 20.655 23.045 25.733 28.755 32.150 Period 12 13.412 15.026 16.870 18.977 21.384 24.133 27.271 30.850 34.931 39.581 Period 13 14.680 16.627 18.882 21.495 24.523 28.029 32.089 36.786 42.219 48.497 Period 14 15.974 18.292 21.015 24.215 27.975 32.393 37.581 43.672 50.818 59.196 Period 15 17.293 20.024 23.276 27.152 31.772 37.280 43.842 51.660 60.965 72.035 Period 16 18.639 21.825 25.673 30.324 35.950 42.753 50.980 60.925 72.939 87.442 Period 17 20.012 23.698 28.213 33.750 40.545 48.884 59.118 71.673 87.068 105.931 Period 18 21.412 25.645 30.906 37.450 45.599 55.750 68.394 84.141 103.740 128.117 Period 19 22.841 27.671 33.760 41.446 51.159 63.440 78.969 98.603 123.414 154.740 Period 20 24.297 29.778 36.786 45.762 57.275 72.052 91.025 115.380 146.628 186.688 Period 21 25.783 31.969 39.993 50.423 64.002 81.699 104.768 134.841 174.021 225.026 Period 22 27.299 34.248 43.392 55.457 71.403 92.503 120.436 157.415 206.345 271.031 Period 23 28.845 36.618 46.996 60.893 79.543 104.603 138.297 183.601 244.487 326.237 Period 24 30.422 39.083 50.816 66.765 88.497 118.155 158.659 213.978 289.494 392.484 Period 25 32.030 41.646 54.865 73.106 98.347 133.334 181.871 249.214 342.603 471.981 Period 26 33.671 44.312 59.156 79.954 109.182 150.334 208.333 290.088 405.272 567.377 Period 27 35.344 47.084 63.706 87.351 121.100 169.374 238.499 337.502 479.221 681.853 22% 1.000 2.220 3.708 5.524 7.740 10.442 13.740 17.762 22.670 28.657 35.962 44.874 55.746 69.010 85.192 104.935 129.020 158.405 194.254 237.989 291.347 356.443 435.861 532.750 650.955 795.165 971.102 24% 1.000 2.240 3.778 5.884 8.048 10.980 14.615 19.123 24.712 31.643 40.238 50.895 64.110 80.496 100.815 126.011 157.253 195.994 244.033 303.601 377.465 469,056 582.630 723.461 898.092 1114,634 1383.146 26% 28% 1.000 1.000 2.260 2.280 3.848 3.918 5.848 8.016 8.368 8.700 11.544 12.136 15.546 16.534 20.588 22.163 28.940 29.369 34.945 38.593 45.031 50.398 57.739 65.510 73.751 84.853 93.926 109.812 119.347 141.303 151.377 181.868 191.735 233.791 242.585 300.252 308.658 385.323 387.389 494.213 489.110 633.593 617.278 811.999 778.771 1040.358 982.251 1332.659 1238.636 1706.803 1561.682 2185.708 1968.719 2798.706 30% 1.000 2.300 3.990 6.187 9.043 12.756 17.583 23.858 32.015 42.619 56.405 74.327 97.625 127.913 167.286 218.472 285.014 371.518 483.973 630.165 820.215 1067.280 1388,464 1806.003 2348.803 3054.444 3971.778 32% 1.000 2.320 4.062 6.362 9.398 13.406 18.696 25.678 34.895 47,062 63.122 84.320 112.303 149.240 197.997 262.356 347.309 459.449 807.472 802.863 1060.779 1401.229 1850.622 2443.821 3226.844 4260.434 5624.772 40% 1.000 2.400 4.360 7.104 10.946 16.324 23.853 34.395 49.153 69.814 98.739 139.235 195.929 275.300 386.420 541.988 759.784 1064.697 1491.578 2089.206 2925.889 4097.245 5737.142 8032.999 11247.199 15747.079 22046.910 Periods Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Period 8 Period 9 Period 10 Period 11 Period 12 Period 13 Period 14 Period 15 Period 16 Period 17 Period 18 Period 19 Period 20 Period 21 Period 22 Period 23 Period 24 Period 25 Period 26 Period 27 Print Done i Requirements 1. Calculate (a) net present value, (b) payback period, and (c) internal rate of return. 2. Calculate accrual accounting rate of return based on net initial investment. Print Done