the requirer n A: Years 1-10 Prese The company is considering two possible expansion plans. Plan A would open eight smaller shops at a cost of $8,500,000. Expected annual net cash inflows are $1,550,000 for 10 years, with zero residual value at the end of 10 years. Under Plan B, Leches Company would open three larger shops at a cost of $8,100,000. This plan is expected to generate net cash inflows of $1,020,000 per year for 10 years, the estimated useful life of the properties. Estimated residual value for Plan B is $980,000. Leches Company uses straight-line depreciation and requires an annual return of 6%. the the 10 Prese Total 0 Initial Net present value of Plan A Print Done 2,908,000 Calculate the NPV of Plan B. (Complete all answer boxes. Enter a "0" for any zero balances or amounts that do not apply to the p. parentheses or a minus sign for a negative net present value.) Plan B: Net Cash Years. 1-10 Present value of annuity Inflow $1,020,000 Annuity PV Factor (i=6%, n=10) PV Factor Present (i=6%, n=10) Value 7.36 $ 7,507,200 0.558 10 Present value of residual value Total PV of cash inflows (8,100,000) 0 Initial Investment Net present value of Plan B (592800) Periods 1% 2% 3% Period 1 0.990 0.980 4% 5% 6% 7% 0.971 0.962 0.952 0.943 0.935 Period 2 0.980 0.961 0.943 0.925 0.907 0.890 0.873 Period 3 0.971 0.942 0.915 0.889 0.864 0.840 0.816 Period 4 0.961 0.924 0.888 0.855 0.823 0.792 0.763 Period 5 0.951 0.906 0.863 0.822 0.784 0.747 0.713 0.681 Period 6 Period 7 0.942 0.888 0.837 0.933 0.871 0.813 0.760 Period 8 0.923 0.853 0.789 0.731 Period 9 Period 10 0.905 0.820 0.744 0.676 0.614 0.790 0.746 0.705 0.666 0.630 0.711 0.665 0.623 0.583 0.677 0.627 0.582 0.914 0.837 0.766 0.703 0.645 0.592 0.544 0.558 0.508 Period 11 0.896 0.804 0.722 0.650 0.585 Period 12 0.887 0.788 0.701 0.625 0.557 0.527 0.475 0.429 0.497 0.444 0.397 Period 13 0.879 0.773 0.681 0.601 0.530 0.469 0.415 0.368 Period 14 0.870 0.758 Period 15 0.861 0.743 0.642 0.555 0.481 0.661 0.577 0.505 0.442 0.388 0.340 0.417 0.362 0.315 0.275 0.239 0.183 Period 16 0.853 0.728 0.623 0.534 0.458 Period 17 0.844 0.714 0.605 0.513 0.436 Period 18 0.836 0.700 0.587 0.494 0.416 Period 19 0.828 0.686 0.570 0.475 0.394 0.339 0.371 0.317 0.350 0.296 0.250 0.396 0.331 0.277 0.232 Period 20 0.820 0.673 0.554 0.456 0.377 0.312 0.258 0.215 Period 21 0.811 0.660 0.538 0.439 0.359 Period 22 0.803 0.647 0.522 0.422 0.342 Period 23 0.795 0.634 0.507 0.406 0.326 Period 24 0.788 0.622 0.492 0.390 0.310 Period 25 0.780 0.610 0.478 0.375 0.295 0.294 0.242 0.278 0.226 0.262 0.211 0.247 0.197 0.233. 0.184 Present Value of $1 8% 9% 10% 12% 14% 15% 16% 18% 20% 0.926 0.917 0.909 0.893 0.877 0.870 0.862 0.847 0.833 0.857 0.842 0.826 0.797 0.769 0.756 0.743 0.718 0.694 0.794 0.772 0.751 0.712 0.675 0.658 0.641 0.609 0.579 0.735 0.708 0.683 0.636 0.592 0.572 0.552 0.516 0.482) 0.650 0.621 0.567 0.519 0.497 0.476 0.437 0.402 0.596 0.564 0.507 0.456 0.432 0.410 0.370 0.335 0.547 0.513 0.452 0.400 0.376 0.354 0.314 0.279 0.540 0.502 0.467 0.404 0.351 0.327 0.305 0.266 0.233 0.500 0.460 0.424 0.361 0.308 0.284 0.263 0.225 0.194 0.463 0.422 0.386 0.322 0.270 0.247 0.227 0.191 0.162 0.388 0.350 0.287 0.237 0.215 0.195 0.162 0.135 0.356 0.319 0.257 0.208 0.187 0.168 0.137 0.112 0.326 0.290 0.229 0.182 0.163 0.145 0.116 0.093 0.299 0.263 0.205 0.160 0.141 0.125 0.099 0.078 0.140 0.123 0.108 0.084 0.065 0.292 0.252 0.218 0.163 0.123 0.107 0.093 0.071 0.054 0.270 0.231 0.198 0.146 0.108 0.093 0.080 0.060 0.045 0.212 0.180 0.130 0.095 0.081 0.069 0.051 0.038 0.194 0.164 0.116 0.083 0.070 0.060 0.043 0.031 0.178 0.149 0.104 0.073 0.061 0.051 0.037 0.026 0.199 0.164 0.135 0.093 0.064 0.053 0.044 0.031 0.022 0.184 0.150 0.123 0.083 0.056 0.046 0.038 0.026 0.018 0.170 0.138 0.112 0.074 0.049 0.040 0.033 0.022 0.015 0.158 0.126 0.102 0.066 0.043 0.035 0.028 0.019 0.013. 0.146 0.116 0.092 0.059 0.038 0.030 0.024 0.016 0.010 Present Value of Ordinary Annuity of $1 Periods Period 1 1% 2% 3% 4% 0.990 0.980 0.971 0.962 Period 2 1.970 1.942 1.913 1.886 Period 3 2.941 2.884 2.829 2.775 Period 4 3.902 3.808 3.717 Period 5 4.853 4.713 4.580 Period 6 5.795 5.601 5.417 Period 7 6.728 6.472 6.230 Period 8 7.652 7.325 7.020 6.733 Period 9 8.566 8.162 7.786 7.435 Period 10 9.471 8.983 8.530 8.111 Period 11 10.368 9.787 9.253 8.760 Period 12 11.255 10.575 9.954 9.385 Period 13 Period 14 Period 15 12.134 11.348 10.635 13.004 12.106 11.296 13.865 12.849 11.938 8.559 8.061 7.606 5% 6% 7% 8% 9% 10% 12% 14% 15% 16% 18% 20% 0.952 0.943 0.935 0.926 0.917 0.909 0.893 0.877 0.870 0.862 0.847 0.833 1.859 1.833 1.808 1.783 1.759 1.736 1.690 1.647 1.626 1.605 1.566 1.528 2.723 2.673 2.624 2.577 2.531 2.487 2.402 2.322 2.283 2.246 2.174 2.106 3.630 3.546 3.465 3.387 3.312 3.240 3.170 3.037 2.914 2.855 2.798 2.690 2.589 4.452 4.329 4.212 4.100 3.993 3.890 3.791 3.605 3.433 3.352 3.274 3.127 2.991 5.242 5.076 4.917 4.767 4.623 4.486 4.355 4.111 3.889 3.784 3.685 3.498 3.326 6.002 5.786 5.582 5.389 5.206 5.033 4.868 4.564 4.288 4.160 4.039 3.812 3.605 6.463 6.210 5.971 5.747 5.535 5.335 4.968 4.639 4.487 4.344 4.078 3.837 7.108 6.802 6.515 6.247 5.995 5.759 5.328 4.946 4.772 4.607 4.303 4.031 7.722 7.360 7.024 6.710 6.418 6.145 5.650 5.216 5.019 4.833 4.494 4.192 8.306 7.887 7.499 7.139 6.805 6.495 5.938 5.453 5.234 5.029 4.656 4.327 8.863 8.384 7.943 7.536 7.161 6.814 6.194 5.660 5.421 5.197 4.793 4.439 9.986 9.394 8.853 8.358 7.904 7.487 7.103 6.424 5.842 5.583 10.563 9.899 9.295 8.745 8.244 7.786 7.367 11.118 10.380 9.712 9.108 6.628 6.002 5.724 5.342 4.910 4.533 5.468 5.008 4.611 6.811 6.142 5.847 5.575 5.092 4.675 Period 16 Period 17 Period 18 Period 19 Period 20 Period 21 Period 22 Period 23 Period 24 Period 25 14.718 13.578 12.561 11.652 10.838 10.106 9.447 12.166 11.274 10.477 9.763 9.122 8.544 8.022 8.851 8.313 7.824 15.562 14.292 13.166 5.749 5.222 4,775 16.398 14.992 13.754 12.659 11.690 10.828 10.059 9.372 8.756 8.201 7.250 6.467 6.128 5.818 5.273 4.812 17.226 15.678 14.324 13.134 12.085 11.158 10.336 9.604 8.950 8.365 7.366 6.550 6.198 5.877 5.316 4.844 18.046 16.351 14.877 13.590 12.462 11.470 10.594 9.818 9.129 8.514 7.469 6.623 6.259 5.929 5.353 4.870 18.857 17.011 15.415 14.029 12.821 11.764 10.836 10.017 9.292 8.649 7.562 6.687 6.312 5.973 5.384 4.8911 19.660 17.658 15.937 14.451 13.163 12.042 11.061 10.201 9.442 8.772 7.645 6.743 6.359 6.011 20.456 18.292 16.444 14.857 13.489 12.303 11.272 10.371 9.580 8.883 7.718 6.792 6.399 21.243 18.914 16.936 15.247 13.799 12.550 11.469 10.529 9.707 8.985 7.784 6.835 6.434 22.023 19.523 17.413 15.622 14.094 12.783 11.654 10.675 9.823 9.077 7.843 6.873 6.464 6.097 5.467 4.948 6.974 6.265 5.954 7.120 6.373 6.047 5.669 5.162 4.730 5.410 4.909 6.044 5.432 4.925 6.073 5.451 4.937