$24,000 $45,636 $60,000 Joetz Corporation nas gathered the tollowing data on a p
ID: 2392179 • Letter: #
Question
$24,000
$45,636
$60,000
Joetz Corporation nas gathered the tollowing data on a proposed investment project (ignore income taxes.): Investment required in equipment Annual cash inflows Salvage value of equipment Life of the investment Required rate of return $30,000 6,000 15 years 10% Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using the tables provided. The company uses straight-line depreciation on all equipment. Assume cash flows occur uniformly throughout a year except for the initial investment. The net present value of the investment is: Multiple Choice $15,636Explanation / Answer
A) $15,636
Net Present Value= Present Value of Cash Inflow - Present Value of Cash Outflow
= $6,000 * (PVAF,10%,15) - $30,000
= $6,000*7.61 - $30,000
= $45,636.48 - $30,000
= $15,636.48
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