The head of the oncology department of FH Research Center is considering the purchase of some new
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The head of the oncology department of FH Research Center is considering the purchase of some new equipment. The cost is $420,000, the economic life is 5 years, and there is no terminal disposal value. Annual cash inflows from operations would increase by $140,000, and the required rate of return is 14%. There are no taxes.
1. Compute the NPV.
2. Should the research center acquire the equipment? Explain.
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Related Book For
Introduction to Management Accounting
ISBN: 978-0133058789
16th edition
Authors: Charles Horngren, Gary Sundem, Jeff Schatzberg, Dave Burgsta
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