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The Scampini Supplies Company recently purchased a new delivery truck. The new truck cost $ 2 2 , 5 0 0 , and it is

The Scampini Supplies Company recently purchased a new delivery truck. The new truck cost $22,500, and it is expected to generate net after-tax operating cash flows, including depreciation, of $6,250 per year. The truck has a 5-year expected life. The expected salvage values after tax adjustments for the truck are given below. The company's cost of capital is 11.5 percent.
\table[[Year,Annual Operating Cash Flow,Salvage Value],[0,-$22,500,$22,500,1,6,250,17,500,2,6,250,14,000,3,6,250,11,000,4,6,250,5,000,5,6,250,0

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