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The management of Green Company is considering to purchase an equipment to be attached with the main manufacturing machine. The equipment will cost $75,000 and

The management of Green Company is considering to purchase an equipment to be attached with the main manufacturing machine.

The equipment will cost $75,000 and will increase annual cash-inflows by $22,000. The useful life of the equipment is 6 years. After 6 years it will have $10,000 salvage value.

The management wants a 10% return on all investments.

Compute net present value (NPV) of this investment project.image text in transcribed

The management of Green Company is considering to purchase an equipment to be attached with the main manufacturing machine. The equipment will cost $75,000 and will increase annual cash-inflows by $22,000. The useful life of the equipment is 6 years. After 6 years it will have $10,000 salvage value. The management wants a 10% return on all investments. Compute net present value (NPV) of this investment project. NOTE: PRESENT VALUE TABLES ARE POSTED ON THE RIGHT. SLIDE OVER or UP/DOWN TO VIEW TABLE VALUES. A. $75,000 B. $3,384 C. $99,810 D. 26,457

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