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Techno Labs, a nonprofit organization, estimates that it can save $ 3 3 , 0 0 0 a year in cash operating costs for the
Techno Labs, a nonprofit organization, estimates that it can save $ a year in cash operating costs for the next years if it buys a specialpurpose eyetesting machine at a
cost of $ No terminal disposal value is expected. Techno Labs' required rate of return is Assume all cash flows occur at yearend except for initial investment
amounts. Techno Labs uses straightline depreciation.
Present Value of $ table
Present Value of Annuity of $ table
Future Value of $ table
Future Value of Annuity of $ table
Read the requirements.
Requirement Calculate the following for the specialpurpose eyetesting machine:
a Net present value NPVUse factors to three decimal places,
XXXX and use a minus sign or parentheses for a negative net present value. Enter the net present value of the
investment rounded to the nearest whole dollar.
The net present value is
Requirements
Calculate the following for the specialpurpose eyetesting machine:
a Net present value
b Payback period
c Internal rate of return
d Accrual accounting rate of return based on net initial investment
e Accrual accounting rate of return based on average investment
Requirement What other factors should Techno Labs consider in deciding whether to purchase the specialpurpose eyetesting machine?
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