! Required information (The following information applies to the questions displayed below.) Project Y requires a $350,000 investment for new machinery with a four-year life and no salvage value. The project yields the following annual results. Cash flows occur evenly within each year.( PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Project Y $ 350,000 Annual Amounts Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation-Machinery Selling, general, and administrative expenses Income 157,500 87,500 49,000 $ 56,000 4. Determine Project Y's net present value using 8% as the discount rate. (Do not round intermediate calculations. Round your present value factor to 4 decimals and final answers to the nearest whole dollar.) Present Value Net Cash Flows x of Annuity at 8% Present Value of Net Cash Flows Years 1-4 = Net present value Salsa Company is considering an investment in technology to improve its operations. The investment costs $250,000 and will yield the following net cash flows. Management requires a 10% return on investments. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Year 1 Net Cash Flow $ 47,000 52,000 75,000 94,000 125,000 3 4 5 Required: 1. Determine the payback period for this investment. 2. Determine the break-even time for this investment. 3. Determine the net present value for this investment. 4. Should management invest in this project based on net present value? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Determine the payback period for this investment. (Enter cash outflows with a minus sign. Round your Payback period answe to 1 decimal place.) Year Net Cash Flows Cumulative Net Cash Flows $ Initial investment Year 1 (250,000) 47,000 52,000 75,000 Year 2 Year 3 Year 4 94,000 Year 5 125,000 Payback period = years Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Determine the break-even time for this investment. (Enter cash outflows with a minus sign. Round your break-even time answer to 1 decimal place.) Year Net Cash Flows Present Value of 1 at 10% Present Value of Cumulative Net Cash Flows Present Value of Net Cash Flows per Year Initial investment $ (250,000) Year 1 Year 2 Year 3 Year 4 Year 5 Break-even time = years Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Determine the net present value for this investment. Net present value Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Should management invest in this project based on net present value? Should management invest in this project based on net present value?
